1031 tax deferred exchange warnings

There have been a couple of 1031 facilitator companies go bankrupt recently with clients losing over $200 million in funds they had parked for a 1031 exchange.

So what this means is that you do not necessarily want the cheapest company facilitating 1031 exchanges for you but rather a solid company where the funds are not commingled with there operating fund.

Questions should be:

1. How do you protect by exchange funds
2. Are they in a separate account
3. Can we have an account that requires co-signature.

It is one thing to defer taxes and another thing to loose your proceeds. If you loose the proceeds you are still liable for the any taxes payable on your gain. Ouch! A double whammy.