"Does a 1031 Exchange Get Less Than 180 Days If You Sell Late in the Year?"

If your investment property sold in the last few weeks, or it's set to close before the end of the year, you've probably heard about the 180 days you get to buy the next one in a 1031 exchange. For a sale this late in the year, there's a second date in the same rule that can come first, and it's the day your 2026 tax return is due.

A 1031 exchange ends on the 180th day after your sale or on the due date of that year's tax return, whichever comes first. If you file as an individual on a calendar year and sold on or after October 18, 2026, your deadline is April 15, 2027 unless your 2026 return is extended.

I'm Jeff Moran, a mortgage broker in Bluffton, South Carolina, originating since 1996, licensed in fifteen states, NMLS #483943, through C2 Financial Corporation. I'm not a tax advisor, so your CPA is the one to talk to about your return. My part is the loan on the replacement property, and that loan has to close inside the same window.

The 1031 exchange 45-day and 180-day deadlines

Both clocks start on the day you transfer the property you sold. You have 45 days to identify the replacement property in writing, and that part stays the same no matter what time of year you sell. The second clock is the exchange period, which is the time you have to actually close on the replacement property.

The Treasury regulation that sets these dates ends the exchange period at midnight on the earlier of two days. One is the 180th day after you transferred the property you sold. The other is the due date of your tax return for the year you sold it, "including extensions."

For most of the year you'd never notice that second date, because day 180 comes well before April. Once you get into the fall, day 180 starts landing after April 15, and that's when the tax return due date becomes your deadline.

Days a 1031 exchange loses on a sale late in 2026

If you file as an individual on a calendar year, your 2026 return is due April 15, 2027. Counting the day you transfer the property as day zero, a few closing dates work out like this:

Date you transfer the property you sold	180th day	Deadline without an extension	Days lost without one
October 17, 2026	April 15, 2027	April 15, 2027	0
October 18, 2026	April 16, 2027	April 15, 2027	1
November 20, 2026	May 19, 2027	April 15, 2027	34
December 31, 2026	June 29, 2027	April 15, 2027	75

October 17 is the last day you could close and still keep all 180 days without doing anything else, because its 180th day falls right on April 15. Each day after that takes one more day off your exchange, up to 75 days for a sale on December 31.

Your qualified intermediary, the company that holds your sale money during the exchange, and your CPA will give you the official dates for your own exchange. If your return is due on a different date, like a business that files its own return or a taxpayer on a fiscal year, your dates will be different too.

A tax extension gets the full 180 days back

Since the rule counts the due date including extensions, extending your 2026 return moves that due date out past day 180, and day 180 becomes your deadline again. For an individual, the extension is IRS Form 4868. Your CPA can file it and let you know when to file the return itself, along with how the exchange gets reported on it.

So if you sold late in 2026 and you'd like to keep all 180 days, you'd have your CPA extend the 2026 return. You'd keep the exchange open with your qualified intermediary and plan to close on the replacement property by day 180.

Federal disaster relief can change your 1031 dates

The IRS can postpone the 45-day and 180-day deadlines for an exchange affected by a federally declared disaster, and each announcement lists the areas it covers. You can find them on the IRS page for tax relief in disaster situations. If you or either property is in one of those areas, your CPA can check whether the relief applies to your exchange and what your new dates are.

Your replacement loan has to close inside the same window

The rule says you have to receive the replacement property by the deadline, and a purchase with a loan can't close until the loan funds. So whatever your exchange deadline turns out to be, that's also the date your loan has to fund by.

One of the lenders I work with lays out exactly what it needs for a 1031 purchase. The loan has to be on an investment property, and your sale money has to stay with the qualified intermediary the whole time. They'll ask for the sales contract on the property you sold and your 1031 exchange agreement. They also want to see that the replacement property was identified within 45 days and that all of the proceeds go into it within 180 days. You can hold title in an LLC you own, too, under that lender's own rules for doing that.

Fannie Mae allows exchange money for the down payment too. Fannie Mae's Selling Guide B3-4.3-10 says down payment money from a like-kind exchange, which is another name for a 1031 exchange, can be used as long as the exchange is properly documented and follows Section 1031 of the tax code. That means your exchange money can be the down payment on a conventional loan for an investment property, as long as the exchange paperwork is there. How underwriters trace the money in your accounts covers the rest of that paper trail.

Choosing the loan for a 1031 replacement property

I can do either a conventional investment property loan or a DSCR loan for the replacement. A DSCR loan qualifies you based on the property's rent compared with its payment instead of your tax returns, which can help if your returns show a lot of depreciation. How a DSCR loan's coverage ratio works walks through how that's figured. A conventional investment property loan looks at your income, your rental income history, and the reserves you'll have left after closing.

We can talk through which one fits while you're still putting your identification list together, so the loan is lined up before you're under contract.

If the replacement property is a home you'd like to live in someday, the loan still closes as an investment property at the start. A 1031 exchange into a home you plan to live in goes through how the IRS rules and the occupancy rules fit together, and second home or investment property explains why that choice on the application matters so much.

Getting the replacement loan closed in time

1. Your exchange dates. It's good to have your dates from your CPA and your qualified intermediary before anything else: the transfer date, the 45th day, the 180th day, your return due date, and whether you're extending.
2. A call with me before you go under contract. I'll go over which loan fits, and we'll make sure the closing date on the contract comes a comfortable amount of time before your deadline. If your deadline is April 15 instead of day 180, the contract needs a closing date before April 15.
3. The exchange paperwork. When you're ready, please provide the complete settlement statement or closing disclosure from the sale of the property you sold, all pages, along with the 1031 exchange agreement from your qualified intermediary. We'll need both to show where your down payment is coming from.
4. Your income and asset documents, if the loan uses them. For a conventional loan, please provide your most recent complete federal income tax return, all pages and schedules, please, and I'll let you know if we need the year before too. Please also provide your two most recent months of bank, investment or retirement account statements for the accounts you'll be using, all pages, even if the last page is intentionally left blank. A DSCR loan works off the property's rent and the appraisal instead, so I'll tell you which documents we need once we've picked the loan. If you're holding title in an LLC on a loan that allows it, please include the LLC's articles of organization, its complete operating agreement, all pages, and the SS-4 or another document showing its federal tax ID number.
5. The appraisal and the closing. Once the contract is signed, we'll order the appraisal right away and set the closing ahead of your deadline. I can't promise how long any one step will take, so I'd rather we start early.

Common mistakes with a year-end 1031 exchange

One is counting 180 days from the sale and stopping there. Day 180 is only your deadline if it comes before your return due date, and for a sale on or after October 18, 2026, it doesn't unless the return gets extended.

Another is filing your 2026 return before talking with your CPA about the exchange. The rule ties your exchange deadline to that return, so it's worth having that conversation before anything gets filed.

The last one is writing a contract that closes the same week as your deadline. If the appraisal runs late or the seller needs a few extra days, you don't have anywhere to go. It's a lot easier to set the closing date with some time in front of the deadline.

An example with made-up dates

These dates are made up to show how it works, and they aren't anyone's file.

Let's say you close on your investment property on November 20, 2026, and you file your taxes as an individual on a calendar year. Your 45th day to identify the replacement is January 4, 2027, and day 180 is May 19, 2027. Your 2026 return is due April 15, 2027, which comes first, so without an extension your exchange ends on April 15 and you'd lose 34 days.

If your CPA extends your 2026 return, the due date moves out past May 19, and you have the full 180 days. Your loan would then need to fund by May 19 instead of April 15. If you'd already agreed on a May closing with the seller, the extension is what keeps that date working.

If your investment property sold this fall, or it's closing before the end of the year, you're welcome to call me at (843) 765-0000. We can put your exchange dates and your loan dates side by side and make sure the loan is set up to fund in time, and your CPA can handle the tax side, including the extension.

Nothing here is tax advice, legal advice or a credit decision; the decision on any file is the lender's.

Common questions

Does my 1031 exchange deadline get shorter if I sell at the end of the year?

It can. The exchange ends on the 180th day after your sale or on the due date of your tax return for that year, including extensions, whichever comes first. If you file as an individual on a calendar year and sold on or after October 18, 2026, April 15, 2027 comes before day 180, so that's your deadline unless you extend the return. A sale on October 17, 2026 has its 180th day on April 15 and keeps all of its days.

How does a tax return extension affect the 1031 exchange 180 days?

The rule counts the due date including extensions, so extending the return for the year of your sale moves that date out past day 180, and you get the full 180 days back. For an individual, the extension is IRS Form 4868. Your CPA can confirm your due date, file the extension and let you know when to file the return.

Can I use 1031 exchange funds as the down payment on a mortgage?

Yes. Fannie Mae's Selling Guide B3-4.3-10 says down payment money from a like-kind exchange, another name for a 1031 exchange, can be used as long as the exchange is properly documented and follows Section 1031 of the tax code. One of the lenders I work with also asks for the sales contract on the property you sold and your 1031 exchange agreement.

Does my replacement property loan have to close before the 1031 deadline?

Yes. The exchange period is the time you have to receive the replacement property, and a purchase with a loan can't close until the loan funds. If your deadline is your return due date instead of day 180, the loan has to fund by that earlier date.

Can the IRS extend 1031 deadlines after a disaster?

It can. The IRS can postpone the 45-day and 180-day deadlines for an exchange affected by a federally declared disaster, and each announcement lists the areas it covers on its tax relief in disaster situations page. Your CPA can check whether you or either property is covered and what your new dates would be.