relinquished property

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In a 1031 exchange, the real property the investor is selling to defer recognition of gains from the sale as taxable income. A reference to relinquished property is made in § 1031(a)(3) of the Internal Revenue Code, which requires that the property be identified, and that exchange be completed not more than 180 days after transfer of exchanged property. Specifically, it states that property received in a 1031 exchange is not treated as like-kind property if “such property is not identified as property to be received in the exchange on or before the day which is 45 days after the date on which the taxpayer transfers the property relinquished in the exchange.” 

[Last updated in April of 2021 by the Wex Definitions Team]