The short answer
It can be attempted, but you lose the IRS's promise not to challenge it. Rev. Proc. 2000-37 caps the safe harbor at 180 days while acknowledging that parking 'can be accomplished outside of the safe harbor'. The Tax Court in Estate of Bartell, 147 T.C. 140 (2016), upheld a 17-month parking arrangement, but the IRS answered with a nonacquiescence saying that outside the safe harbor there is no exchange if you, rather than the accommodation party, carried the benefits and burdens of ownership. A longer arrangement therefore needs a titleholder that genuinely bears ownership risk, or a willingness to litigate.
At a glance
| Safe harbor limit | 180 days, Rev. Proc. 2000-37 section 4.02 |
|---|---|
| Outside the safe harbor | No inference either way, section 3.02 |
| Bartell | 17-month parking upheld by the Tax Court, 147 T.C. 140 |
| IRS response | Nonacquiescence, Action on Decision 2017-06 |
| IRS test outside 180 days | Who held the benefits and burdens of ownership |
| Bartell's timing | Transaction from 2000 to 2001, decided on pre-regulation case law |
| Disaster relief | Rev. Proc. 2018-58 can postpone the 180 days, up to one year |
The revenue procedure leaves room outside the 180 days but promises nothing there
Section 3.02 of Rev. Proc. 2000-37 says the IRS 'recognizes that parking transactions can be accomplished outside of the safe harbor' and that 'no inference is intended' about those that do not satisfy it. Section 3.04 adds that when the requirements are missed, ownership 'will be made without regard to the provisions of this revenue procedure.'
Inside the safe harbor, the titleholder is treated as owner even though you guarantee its debt, lease the property and manage it. Outside it, those same features become evidence that you were the owner all along.
If you were the owner when the titleholder bought the property, your later sale was not exchanged for anything; you simply bought one property and sold another.
Bartell won in the Tax Court on facts the IRS says it will not accept again
As summarized in Action on Decision 2017-06, an exchange facilitator took title to the replacement in August 2000, the taxpayer built a drugstore on it and began leasing it in June 2001, and the exchange closed in December 2001, 17 months later. The Tax Court held that a facilitator 'need not assume the benefits and burdens of ownership of the replacement property in order to be treated as its owner for section 1031 purposes before the exchange.'
The IRS's nonacquiescence states that the case law Bartell relied on involved transactions 'consummated prior to the issuance of the deferred exchange regulations and Rev. Proc. 2000-37.' Going forward, 'taxpayers that use accommodating parties outside the scope of Rev. Proc. 2000-37 have not engaged in an exchange if the taxpayer, rather than the accommodating party, acquires the benefits and burdens of ownership.'
A nonacquiescence does not overrule the Tax Court. It tells you the IRS will raise the issue on audit and expects to litigate it.
A non-safe-harbor parking has to give the titleholder real ownership
The IRS's test is the general one stated in section 2.03 of the revenue procedure: 'the party that bears the economic burdens and benefits of ownership will be considered the owner.' A titleholder that is fully guaranteed, fully indemnified and leasing the property back to you at cost bears almost nothing.
Shifting genuine risk and reward to the titleholder costs money. An accommodation party taking market risk on a building for a year or more will price that risk, and the terms you would need to give up are the same protections that make a safe harbor parking comfortable.
That is why most long builds are restructured to fit inside 180 days rather than pushed outside it (do improvements have to be finished by day 180).
Worked example: a 12-month build-to-suit squeezed into the safe harbor
Hypothetical, round numbers; run your own numbers with your CPA. You want a $2,000,000 build-to-suit that will take 12 months, funded by a $1,500,000 sale with an $800,000 gain.
Inside the safe harbor, the titleholder can hold the site for 180 days while $600,000 of site work and shell construction goes in, then deed the land and that work to you. If the land cost $500,000, you have received $1,100,000 of like-kind property and the remaining $400,000 of proceeds must go into other identified property or be taxed as boot.
The non-safe-harbor alternative might defer the full gain, but only if the titleholder carries real ownership for 12 months and you are prepared to defend the structure on audit.
Choose the shorter path unless the numbers justify a fight
Exhaust the safe harbor first: identify the relinquished property early, price the sale to close, and use the disaster postponement in Rev. Proc. 2018-58 if a declared disaster genuinely affects you.
If the sale will not close in time, the cleaner fallback is to let the reverse leg end and run a forward exchange later (what happens if your property does not sell in 180 days).
Any arrangement intended to run longer needs a written opinion from a tax adviser before the titleholder takes title, not after day 180. The reverse exchange guide sets out the safe harbor sequence.
Related questions
Does Bartell mean 180 days no longer matters?
No. Bartell involved a transaction before the regulations and the safe harbor, and the IRS has said it will not follow the decision for later transactions where the taxpayer held the benefits and burdens.
Is a nonacquiescence binding law?
No. It states the IRS's litigating position, so you should expect the IRS to challenge a similar structure even though the court ruled the other way.
Can the 180 days be extended by agreement?
No. The only extension in published guidance is the federally declared disaster postponement in Rev. Proc. 2018-58.
Can I end the parking at 180 days and start a new one?
Not for a replacement you have taken title to; Rev. Proc. 2004-51 bars parking property you owned within the prior 180 days.
Does a longer arrangement change the 45-day identification rule?
Outside the safe harbor there is no published identification rule for parked property, which is another reason the structure carries risk.
Sources
Checked against these publications on September 30, 2026. Rules and figures change; confirm the current version with your CPA or attorney before you act. This page is general information, not tax or legal advice.