Friday, November 24, 2017

Cooperation Clause

You may want to add the following Cooperation Clause language to your Contract when Selling your Relinquished Property

“In the event Seller so elects, Buyer agrees to cooperate with Seller in effecting a tax deferred Exchange under Internal Revenue Code Section 1031 as amended. Seller shall have the right to elect this tax deferred Exchange at any time prior to the closing date and to assign this contract in connection with such tax deferred Exchange”

You may want to add the following Cooperation Clause language to your Contract when Selling your Replacement Property

“In the event Buyer so elects, Seller agrees to cooperate with Seller in effecting a tax deferred Exchange under Internal Revenue Code Section 1031 as amended. Buyer shall have the right to elect this tax deferred Exchange at any time prior to the closing date and to assign this contract in connection with such tax deferred Exchange”

If your contract does not include this Cooperation Clause, the contract can be amended at closing, provided the buyer or seller does not object.