Escrow & Title
An Indiana title company conducting a 1031 exchange serves as the:
AQualified intermediary
BTitle company acts as escrow holder; a separate qualified intermediary (QI) is required to facilitate the 1031 exchange✓ Correct
CExchange broker
DInvestment advisor
Explanation
In a 1031 exchange, the title company handles the closing mechanics, but a separate, qualified intermediary (not the title company) must hold the exchange funds and facilitate the exchange. The same entity cannot act as both.
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Key Terms to Know
Escrow
A neutral third-party arrangement where funds, documents, and instructions are held until all conditions of a real estate transaction are satisfied.
1031 ExchangeA tax-deferred exchange allowing investors to sell one investment property and reinvest proceeds in a like-kind property while deferring capital gains taxes.
Title InsuranceInsurance protecting against financial loss from defects in a property's title that existed before closing but were unknown at the time of purchase.
Chain of TitleThe sequential record of all transfers of ownership for a piece of property from the original patent holder to the present owner.
Math Concepts
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