The 45-day identification period starts the moment your relinquished property closes, not when you find a qualified intermediary or decide you are ready to look. In Miami, where closings on multifamily and industrial assets can happen on a Friday afternoon with the seller already on a flight out, that clock does not pause for anyone's schedule. You have exactly 45 calendar days, including weekends and holidays, to put a written list of candidate replacement properties in your qualified intermediary's hands.
Missing the window does not mean a short extension or a grace period. It means the exchange fails, the sale is treated as an ordinary taxable transaction, and the entire capital gains bill comes due on the return you would otherwise have deferred.
What the Written Identification Actually Requires
The identification has to be unambiguous, in writing, signed, and delivered to the qualified intermediary or another party permitted under the exchange regulations before midnight on day 45. A verbal mention of a Wynwood retail building during a phone call does not count, and neither does a draft email that never gets sent. Each property named needs a legal description precise enough that a stranger could locate it without guessing, which in practice means pulling the description from a title commitment or purchase contract rather than typing an address from memory.
The Three-Property Rule
Most exchangers use the three-property rule, which lets you identify up to three replacement properties of any value, with no cap on price. This is the simplest option and the one that fits a typical Miami exchange where an owner is trading one apartment building or one industrial flex property for another. You do not have to buy all three, only close on one or more from the named list, but every property you eventually acquire has to have appeared on the original identification.
The 200% Rule
If you want to name more than three properties, the 200% rule allows it, as long as the combined fair market value of everything on the list does not exceed 200% of what you sold the relinquished property for. A Coral Gables owner selling a $4 million office building could identify five or six candidate properties under this rule, provided their combined value stays under $8 million. This rule is useful when a market is competitive enough that a short list feels risky, since it lets you spread bids across more targets without breaking the identification.
The 95% Rule and Why Exchangers Rarely Use It
The 95% rule removes both the count and the value caps entirely, but only if you actually acquire 95% of the total value of everything identified. Name ten properties under this rule and fail to close on at least 95% of their combined value, and the entire exchange can be disqualified, not just the properties you missed. Because the penalty for falling short is so severe, almost no exchanger chooses this path deliberately; it tends to matter only as a fallback calculation when a list built under the 200% rule accidentally grows too long.
Common 1031 Exchange Questions
When does the 45-day identification period actually start?
It starts on the day the relinquished property closes, not when the qualified intermediary is engaged or when you begin searching, and it runs on calendar days including weekends and holidays.
Which identification rule should a typical Miami exchanger use?
Most owners use the three-property rule, since it covers a standard exchange of one property for one or two replacements without any value cap, and it is the easiest rule to track.
Can I identify more than three properties?
Yes, under the 200% rule, as long as the combined fair market value of every property named does not exceed 200% of the relinquished property's sale price.
What happens if I miss the 45-day deadline?
The exchange fails. There is no extension for a missed identification deadline, and the sale becomes a fully taxable transaction reported on the return for the year of the sale.
Does a verbal or emailed conversation with my agent satisfy the identification requirement?
No. The identification must be a written, signed notice delivered to the qualified intermediary or another party permitted under the exchange rules before midnight on day 45.
Why do so few exchangers use the 95% rule?
Because failing to close on at least 95% of the combined value of everything identified can disqualify the entire exchange, not just the missed properties, making it a high-risk fallback rather than a default choice.
