A qualified intermediary is an entity that facilitates a like-kind exchange by holding the proceeds from the sale of one property until they are used to purchase another property, ensuring that the exchange meets IRS requirements for tax deferral. This role is crucial in enabling investors to defer capital gains taxes on the profit made from selling real estate by using the proceeds to acquire similar properties within specific timeframes. By acting as a neutral third party, the qualified intermediary helps taxpayers navigate the complexities of tax regulations while maintaining compliance.
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