The short answer
A qualified exchange accommodation arrangement, or QEAA, is an arrangement that meets all six conditions in section 4.02 of Rev. Proc. 2000-37, so the IRS treats the exchange accommodation titleholder as the owner of the property it holds for you. That treatment is what lets a parked property count as replacement or relinquished property in a reverse exchange. Miss any one condition and the arrangement is not a QEAA.
At a glance
| Written agreement | Signed no later than five business days after the titleholder takes title |
|---|---|
| Identification | Relinquished property identified within 45 days |
| Exit deadline | Property transferred out within 180 days |
| Titleholder tax status | Subject to federal income tax, or a pass-through more than 90 percent owned by taxpayers |
Six conditions define a QEAA, and all of them must be met.
Section 4.02 of Rev. Proc. 2000-37 lists the conditions. The titleholder must not be you or a disqualified person, and must hold qualified indicia of ownership, meaning legal title, a beneficial interest such as a contract for deed, or interests in a disregarded entity that holds title.
- The titleholder is subject to federal income tax, or, if a partnership or S corporation, more than 90 percent owned by partners or shareholders who are.
- When title passes to the titleholder, you have a bona fide intent that the property be part of a section 1031 exchange.
- Within five business days, you and the titleholder sign a written agreement stating it holds the property for your benefit and will be treated as the beneficial owner for all federal income tax purposes.
- Within 45 days, the relinquished property is identified under the principles of Reg. section 1.1031(k)-1(c).
- Within 180 days, the property goes to you as replacement property or to an unrelated buyer as relinquished property.
- The combined time both properties sit in the arrangement does not exceed 180 days.
The permitted side agreements let you finance and run the parked property.
Section 4.03 says certain arrangements do not break a QEAA even if they are not arm's length. You or a disqualified person may guarantee the titleholder's debt, lend or advance it funds, lease the property from it, manage it or supervise its improvement, and agree to puts and calls at fixed or formula prices for up to 185 days.
Hypothetical: a titleholder buys a $1,000,000 lot for you on May 1 with money you lend it, leases the lot back to you, and you supervise construction of a building on it. The written agreement is signed on May 5. Everything listed is permitted, but the building must be finished enough to transfer, and the lot and building must reach you, by October 28. Confirm the dates with your CPA and intermediary.
The improvement exchange guide covers what counts as replacement property when construction is incomplete on day 180.
The five-business-day agreement and the 180-day exit are where QEAAs most often fail.
The agreement deadline runs from the day title passes to the titleholder, not from when you start talking about an exchange. The agreement must also say both parties will report the property consistently with it, and both returns must actually do so.
Rev. Proc. 2004-51 added a further limit: the safe harbor does not cover replacement property you owned within 180 days before the titleholder took title. That is why owners asking whether they can build on land they already own usually find the answer is no under this safe harbor.
For the broader idea of parking, including the outside-the-safe-harbor route, see parking arrangement.
Related questions
Can my qualified intermediary also be the titleholder?
Yes. Section 4.03(1) of Rev. Proc. 2000-37 lets a titleholder that meets the qualified intermediary rules also act as your intermediary in the related exchange.
Does state tax treatment have to match the agreement?
No. Section 4.04 says property is still held in a QEAA even if accounting, regulatory, or state, local or foreign tax treatment differs from the federal reporting the agreement requires.
Can I identify more than one property to sell?
Yes. Section 4.02(4) allows alternative and multiple properties to be identified under the same rules used in a forward exchange.
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.