# Extensions Due to Federally Declared Disaster Areas

Revenue Procedure 2018-58 allows for the extension of the time deadlines for 1031 Exchange transactions when there are declared disasters.

November 02, 2022

Revenue Procedure 2018-58 allows for the extension of the time deadlines for 1031 Exchange
transactions when there are declared disasters.


The IRS will issue a Notice when this type of relief is available and will post such a notice on their
website at [ https://www.irs.gov/newsroom/tax-relief-in-disaster-situations](https://www.irs.gov/newsroom/tax-relief-in-disaster-situations). A taxpayer must meet the
specific terms of the Disaster Relief Notice and the terms as listed in Revenue Procedure 2018-58 to
qualify for any extensions.


In the event of a federally declared disaster, an exchanger may be eligible for an extension of the 45 day
identification period, the 180 day exchange period, or both. Typically, the disaster relief is available to
“affected taxpayers” as defined in an IRS Notice and applied to a 1031 exchange per Rev. Proc. 2018-58,
Sections 6 or 17. Relief is also available to other transferors of property who are specifically impacted as
defined in [Rev. Proc. 2018-58, Section 17.](https://www.irs.gov/pub/irs-drop/rp-18-58.pdf)


There are two ways a taxpayer may qualify for extensions:




The Exchange started on or before the date of the federally declared disaster, and
The Exchangor is located in an affected area. The IRS does issue their notice by county. They will say which counties qualify for the extensions and the duration of the tax relief provided.


Exchangors may still receive extensions even if they are not in the affected areas. If their relinquished or
replacement property is located in the qualifying area; the primary place of business of any party to the
transaction is located in the disaster area; or a lender will now not fund the loan due to the disaster.


Eligibility for the disaster extensions does vary on a case by case basis. Your Qualified Intermediary
cannot advise you if you qualify or not. It is strongly encouraged that a taxpayer consult with their tax
professional about this issue should it apply.


For additional information, please reach out to your tax professional for specific questions or contact
the specialists here at Security 1st Exchange for assistance.