Detailed Exchange Information
• Aircraft
• Improvement
• Personal Property
• Real Property
• Reverse
• Cooperation Language & Forms
• Real Property Exchanges
• Personal Property Exchanges
• General Provisions
Schedule of Fees and Costs for
Real Property Exchanges
Delayed & Simultaneous Forward Exchanges
Fees
A fee of $300 is required to set up the exchange and the disposition of one relinquished property, in addition to a $300 fee for each additional relinquished or replacement property. An additional value-based set-up fee is required for each relinquished property with a sales price of $300,000 or more, according to the following schedule:
|
Property Value (per Sales Price) | Value-Based Fee |
| Under $300,000 | Included in $300.00 Set-Up Fee |
| $300,000 to $999,999 | .10% of Property Value Over $300,000 |
| $1 Million to $4,999,999 | .05% of Property Value Over $300,000 |
| $5 Million and Above | .025% of Property Value Over $300,000 |
For example, the fees for an exchange with one relinquished property valued at $350,000, and one replacement property, would total $650 ($300 set-up fee, plus $50 value-based fee, plus $300 for one replacement property).
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Interest
All exchanges with at least $200,000 of exchange proceeds will earn interest at a rate equal to a portion of the Federal Funds rate less one percent (1.0%) for a current balance under $5,000,000, or one-half of one percent (.50%) for a balance greater than $5,000,000, determined by the current balance of exchange proceeds on the date of accrual per the schedule below:
| Balance of Exchange Proceeds | Portion of Federal Funds Rate Paid | |
| Step 1 | Step 2 | |
| Under $200,000 | None | None |
| $200,000 to $499,999 | Rate — 1% | One-Third (1/3) |
| $500,000 to $999,999 | Rate — 1% | Two-Thirds (2/3) |
| $1,000,000 to $4,999,999 | Rate — 1% | All |
| $5,000,000 and Above | Rate — 0.5% | All |
For example, assuming a Federal Funds Rate of 5.25%, an exchange proceeds balance of $550,000 would earn interest at a rate of 2.83% per annum (2/3 of 4.25%).
Retained Interest
Certain amounts of interest earned on segregated accounts retained by National 1031 Exchange Service as additional compensation for services rendered.
Improvement & Reverse Exchanges
Title Holding Transactions ("Improvement" & "Reverse" Exchanges)
The basic fee to set up a "Qualified Exchange Accommodation Arrangement" ("QEAA") to hold title to a "parked property" for up to 180 days is $2,500, plus an amount equal to one-tenth of 1% (.10%) of the value of the parked property. The value of the parked property is its acquisition cost plus the costs of any improvements made while such property is held in the QEAA.
In addition to the basic fee, a minimum fee of $300 is charged if financing with a third party is necessary to acquire the parked property and a fee of $300 is required for documentation and services if improvements are to be made to the parked property, all at the time of acquiring the parked property in the QEAA.
For example, the fee to set up a QEAA to acquire and hold a parked property with a purchase price of $500,000 involving a bank loan would be $3,300 ($2,500 + .10% of $500,000 + $300), plus costs of approximately $150 to set up the title holding entity and other miscellaneous items. If $200,000 in improvements are made to the parked property while held in the QEAA, then an additional set-up fee of $300 would be due upon acquisition of the parked property and $200 (.10% of $200,000) would be required upon disposition of the parked property.
Please note that the fee for handling a QEAA does not include accommodating a forward exchange involving the parked property, and the QEAA fees may be adjusted based upon the complexity of the transaction and the length of time National 1031 Exchange Service holds title to the parked property.
Promissory Notes, Deeds of Trust, Mortgages & Other Financing Instruments
A minimum fee of $300, in addition to any other fees, will be charged for any forward exchange in which National 1031 Exchange Service holds a promissory note, deed of trust or mortgage, or is otherwise involved in the financing of any property involved in the exchange.
