Tax-Free Exchange, Delayed

A transaction in which a property is traded for the promise to provide a replacement Like-Kind Property in the near future. Investment property or productive property used in a trade or business can be sold with the tax on the gain deferred, provided replacement property is identified within 45 days and closed within 180 days. The taxpayer may not receive cash and then use the cash to purchase the replacement property. Other strict requirements must be observed. See also Like-Kind Exchange; Tax-Free Exchange.