If you are inside a 1031 exchange, your money and gain are essentially stuck inside the exchange until it is otherwise legally available to be distributed. This makes it difficult to move into a QOF.
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Why are my funds tied up for 135 days when moving from a 1031 exchange to a QOF?
When executing a 1031 exchange on 1231 property, how can I avoid that my funds are held up once I have identified my replacement property?
Answers
The short answer is that, under Section 1031 and the corresponding Treasury regulations, you basically can't. Your qualified intermediary will not let you, except in a set of very narrow circumstances, none of which will be within your control.
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