The 45-Day and 180-Day Deadlines Explained

When the clock starts

Both deadlines begin on the day your relinquished property sale closes — the date title transfers to your buyer. They run concurrently, not back to back.

That's the single most common misunderstanding: the 45-day identification period is part of the 180 days, not in addition to it. Once you use up 45 days identifying, you have only 135 days left to close.

There are no weekend or holiday extensions. If day 45 lands on a Sunday or Thanksgiving, it's still day 45. The deadline does not roll forward to the next business day the way some filing deadlines do.

This is educational only and not tax advice — work the timeline with your CPA and QI.

How to count the days

Counting is literal calendar arithmetic from the closing date:

• ›Day 0 is your closing date.
• ›Day 45 is exactly 45 calendar days later — mark it on a calendar the day you close.
• ›Day 180 is exactly 180 calendar days after closing.

Example: a sale that closes on March 1 has an identification deadline around April 15 and a closing deadline around August 28. Don't trust a mental estimate — your QI should issue a written deadline letter, and you should independently verify both dates.

The 45-day identification rule

Within 45 calendar days, you must identify your replacement property (or properties) in writing, signed by you, and delivered to your Qualified Intermediary (or another party to the exchange who is not disqualified).

Identification has to be unambiguous — a full street address, legal description, or for a fractional interest, the specific percentage and property. "A building somewhere downtown" or "a property to be determined" does not count. For a DST or fractional interest, identify the percentage interest you intend to acquire.

You can revoke and re-identify as many times as you like, but only before day 45 expires. Once the 45th day passes, your list is locked — you can only close on something already on it.

The 180-day closing rule

You then have a total of 180 calendar days from the sale to actually close on (take title to) one or more of the properties you identified.

One critical catch: the deadline is the earlier of 180 days or your tax-filing due date (including extensions) for the year of the sale. So if you sell in November or December, your 180 days may run past April 15. If you file your return before completing the exchange, you shorten your own window. The fix: file for an extension so the full 180 days remain available.

The identification limits

You can identify more than one candidate, under one of these three rules:

• ›Three-property rule: identify up to three properties, regardless of their value. This is what most investors use.
• ›200% rule: identify any number of properties, as long as their combined fair market value doesn't exceed 200% of what you sold. (Sell for $1M, identify up to $2M of candidates.)
• ›95% rule: identify any number at any value, but you must actually acquire at least 95% of the total value identified. This is a rare, high-stakes fallback.

If you blow past three properties without satisfying the 200% or 95% rule, the IRS can treat it as if you identified nothing — and the entire exchange fails.

Worked timeline example

Suppose you close your sale on June 1:

• ›June 1 (Day 0): Sale closes; QI receives proceeds.
• ›By July 16 (Day 45): Deliver signed identification of up to three replacement properties to your QI.
• ›By November 28 (Day 180): Close on at least one identified property; QI wires funds.

If your first-choice property dies in escrow on Day 100, you can still close on a backup — but only if that backup was on your Day 45 list.

Choosing the right identification rule

The three identification rules are alternatives — you satisfy your exchange by meeting any one of them, and most people never think past the first.

• ›Three-property rule (the default): Identify up to three properties of any value, and you can buy one, two, or all three. Because value is irrelevant, this is the cleanest path for a typical investor buying a single replacement. Listing two backups alongside your target costs nothing and protects you if the primary deal collapses after Day 45.
• ›200% rule (for multiple buys): Used when you want to identify four or more properties — say you're spreading equity across several rentals or DST interests. The combined fair market value of everything on the list can't exceed 200% of what you sold. Sell for $2M and your entire list must total $4M or less. Identify a fourth property that pushes you over 200% and the list can be disqualified.
• ›95% rule (the high-stakes fallback): If you blow both limits — four-plus properties *and* over 200% of value — you can still salvage the exchange, but only by actually closing on properties worth at least 95% of everything you identified. Miss that 95% threshold even slightly and the IRS can treat it as if you identified nothing. This rule is unforgiving and rarely used on purpose.

A worked edge case: you sell for $1M and identify five properties worth $500K each — a $2.5M list, which is 250% of your sale, so the three-property and 200% rules are both broken. To save the exchange under the 95% rule you'd have to acquire at least $2.375M (95% of $2.5M) of that list. Falling a single property short fails the entire exchange.

What happens if you miss a deadline

There is no partial credit. Blow the 45-day or 180-day deadline and the transaction is recharacterized as a fully taxable sale of your relinquished property in the year it closed — capital gains, depreciation recapture, and any NIIT come due, and your QI returns the parked funds to you once the exchange period ends.

The only meaningful relief is an IRS disaster declaration. When the IRS issues notice of a federally declared disaster, affected taxpayers may get the later of 120 additional days or the postponed date in the notice to complete identification or closing. This relief is narrow, situational, and announced after the fact — it is not something you can plan or rely on. Treat both clocks as absolute.

Why deadlines are non-negotiable

The IRS treats these dates as bright lines. There is no "good faith" exception for a slow lender, a deal that collapsed, a hot market with no inventory, or a title problem. The only meaningful relief comes from IRS disaster declarations, which can extend deadlines for taxpayers in federally declared disaster areas — but you cannot plan around hoping for one.

What this means for you

The practical takeaway: line up replacement candidates before you close your sale. By the time you're standing at the closing table selling, you should already know what you're buying and have a backup or two in mind. A pre-identified fallback — including a fractional option like a Delaware Statutory Trust (DST), which can typically close quickly — protects you if your primary deal falls through. Treat the 45-day clock as the real deadline; the 180 days disappear faster than you'd think.