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Sample 1031 Exchange Cooperation Clause Language for Contract

Exeter 1031 Exchange Services, LLC is pleased to provide the following sample 1031 Exchange cooperation clause language that can be used in a Purchase and Sale Agreement as a courtesy to you and your legal, tax or financial advisors.  This cooperation clause language may not be appropriate or suitable for your specific situation.  1031 Exchanges are extremely complex transactions.  You should always consult with legal, tax and financial advisors for guidance in selecting the most appropriate cooperation clause language to use for your specific 1031 Exchange transaction prior to executing any Purchase and Sale Agreements, Escrow Instructions, Tax-Deferred Exchange Agreements and/or any other related transactional documentation.

Relinquished Property (Sale or Disposition Property)

Buyer acknowledges that Seller intends to perform a tax-deferred exchange transaction pursuant to Section 1031 of the Internal Revenue Code and Section 1.1031 of the Treasury Regulations and that Seller’s rights, title and interest (but not obligations) pursuant to this [Insert Name of Purchase and Sale Agreement or Sales Contract or Escrow Instructions] will be assigned to Exeter 1031 Exchange Services, LLC, as Seller's Qualified Intermediary, for the purpose of completing Seller's 1031 Exchange transaction.

Buyer agrees to cooperate with Seller and Exeter 1031 Exchange Services, LLC at no additional cost or liability to Buyer, by executing the documents necessary to complete Seller’s 1031 Exchange transaction.

Replacement Property (Purchase or Acquisition Property)

Seller acknowledges that Buyer is completing a tax-deferred exchange transaction pursuant to Section 1031 of the Internal Revenue Code and Section 1.1031 of the Treasury Regulations and that Buyer’s rights, title and interest (but not obligations) pursuant to this  [Insert Name of Purchase and Sale Agreement or Purchase Contract or Escrow Instructions] will be assigned to Exeter 1031 Exchange Services, LLC, as Buyer's Qualified Intermediary, for the purpose of completing Buyer's 1031 Exchange transaction. 

Seller agrees to cooperate with Buyer and Exeter 1031 Exchange Services, LLC at no additional cost or liability to Seller, by executing the documents necessary to complete Buyer’s 1031 Exchange transaction.

Replacement Property with a Reverse 1031 Exchange 

Seller acknowledges that Buyer is completing a Reverse 1031 Exchange transaction, pursuant to Section 1031 of the Internal Revenue Code, Section 1.1031 of the Treasury Regulations, and IRS Revenue Procedure 2000-37, and that Buyer’s rights, title and interest (but not obligations) pursuant to this [Insert Name of Purchase and Sale Agreement or Purchase Contract or Escrow Instructions] will be assigned to a new limited liability company formed by Exeter Reverse 1031 Exchange Services, LLC, as Buyer's Exchange Accommodation Titleholder, for the sole purpose of completing Buyer's Reverse 1031 Exchange transaction.   

Seller agrees to cooperate with Buyer and Exeter Reverse 1031 Exchange Services, LLC at no additional cost or liability to Seller, by executing the documents and deeds necessary to complete Buyer’s Reverse 1031 Exchange transaction, including an Assignment, Acknowledgment, Notice and Direction to Convey the property into the new limited liability company.  

 

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