A simultaneous exchange is when escrow closes concurrently on the relinquished property (the property being sold in the exchange) and the replacement property (the property being purchased in the exchange). When exchanges were first introduced in the Internal Revenue Code, simple two party simultaneous exchanges were all that were contemplated by the legislation. Over the years, exchanges have grown in complexity, and even now most simultaneous exchanges are not that simple.
The diagrams below show the simple to complex forms of simultaneous 1031 exchanges.
Simultaneous Two Party Exchange
Simultaneous Three Party Exchange
Simultaneous Multi-Party Exchange(s)