---
title: I Need A Backup Strategy For My 1031 Exchange
description: You have a property picked for a 1031 exchange, but want to create a backup plan in case it falls through.
image: https://www.realized1031.com/hubfs/Images/photo/abstract/bull-market-graphs-IS-841214812.jpg
---

[![Realized 1031 Exchange Marketplace](https://www.realized1031.com/hs-fs/hubfs/Images/Brand/Logo/Realized/Realized-Logo-Black.png?width=240&height=80&name=Realized-Logo-Black.png "Realized 1031 Logo") ](https://www.realized1031.com/)

- [Wealth Management Gap](https://www.realized1031.com/the-wealth-management-gap)
- [Our Process](https://www.realized1031.com/how-realized-works)
- [Financial Advisors](https://www.realized1031.com/advisor)
- [Resources](https://www.realized1031.com/resources)

- [The Company](https://www.realized1031.com/about-us)
- [Articles](https://www.realized1031.com/blog)

[Register](https://www.realized1031.com/marketplace)

[Log In](https://www.realized1031.com/login)

- Better Business Bureau Rating: **A+**
- [FINRA BrokerCheck](https://brokercheck.finra.org/firm/summary/22333)
- [Call](tel:1-877-797-1031) **(877) 797-1031**

# I Need A Backup Strategy For My 1031 Exchange

Posted Jul 8, 2020

![bull-market-graphs-IS-841214812](https://www.realized1031.com/hs-fs/hubfs/Images/photo/abstract/bull-market-graphs-IS-841214812.jpg?width=669&name=bull-market-graphs-IS-841214812.jpg)

You have a property picked for a 1031 exchange, but want to create a backup plan in case it falls through. In this article, we’ll walk through a few simple options that can be added to your 1031 forms and used as a backup. 

### Increasing Your Probability Of A Successful 1031 Exchange

Before looking at a few backup options, let’s first ensure you’re following the three different identification rules for completing a 1031 exchange. In addition to 1031 timeframes, these three rules are some of the most important when it comes to successfully completing a 1031 exchange.

1.) [Three Property Rule](https://www.realized1031.com/glossary/three-property-rule) — the most popular of the three rules, this rule has a built-in backup plan. You must identify up to three [replacement properties](https://www.realized1031.com/glossary/replacement-property). You can purchase all of them or just one. If your intent is to purchase one property, the other two properties can be used as backups.

2.) [200% Rule](https://www.realized1031.com/glossary/200-percent-rule) — using this rule, you can identify more than three replacement properties. The catch is that the value of those properties, based on their purchase price, must be less than 200% of the sales price of the property you just sold (i.e., relinquished property).

For example, if you just sold a property for $750,000, you can identify up to $1,500,000 in other properties. This might be five $300,000 properties or one $500,000 property and one $1,000,000 property.

3.) [95% Rule](https://www.realized1031.com/glossary/95-percent-rule) — of the three rules, this one is the riskiest. It states that you can identify as many properties as you like but must purchase 95% of their combined value. Being even a little below the 95% mark can disqualify your 1031.

For example, this time, you sell a property for $1,000,000. That means you can identify 10 properties worth $5 million collectively, but must acquire $4,750,000 in multiple properties or a single property.

### DSTs As A Backup Option

After reading over the above three rules, your head might be spinning a little. The first two rules may seem very practical, but should you immediately exclude the third rule? 

Here at Realized, we can help make identifying backup properties very simple. If you want to use Delaware Statutory Trusts (DSTs) as backup options, we can help write out the ID language for you using the most beneficial ID rule for your situation. 

If you haven’t ever invested in a DST, don’t worry. Realized can help you find a DST that works for your current situation. We’ll help you navigate the above identification rules as well to help ensure a good fit. 

This material is for general information and educational purposes only. Information is based on data gathered from what we believe are reliable sources. It is not guaranteed as to accuracy, does not purport to be complete and is not intended to be used as a primary basis for investment decisions.

Download The Guide To 1031 Exchange

[![The 1031 Investor's Guidebook](https://www.realized1031.com/hs-fs/hubfs/Images/UI/graphics/composites/1031-Exchange-eBook-250.png?width=250&height=250&name=1031-Exchange-eBook-250.png "Tackle the art and science of ...") ](https://www.realized1031.com/blog/i-need-a-backup-strategy-for-my-1031-exchange#blogform)

Download eBook

---

 

---

### The 1031 Investor's Guidebook

![Download The Guide To 1031 Exchange](https://www.realized1031.com/hs-fs/hubfs/Images/UI/graphics/composites/1031-Exchange-eBook-550.jpg?width=550&height=650&name=1031-Exchange-eBook-550.jpg)

Tackle the art and science of completing your 1031 exchange.

By providing your email and phone number, you are opting to receive communications from Realized. If you receive a text message and choose to stop receiving further messages, reply STOP to immediately unsubscribe. Msg & Data rates may apply. To manage receiving emails from Realized visit the Manage Preferences link in any email received.

Search

### [Why Realized](https://www.realized1031.com/why-realized)

- [Wealth Management](https://www.realized1031.com/the-wealth-management-gap)
- [Why Realized](https://www.realized1031.com/why-realized)
- [Our Process](https://www.realized1031.com/how-realized-works)
- [Scenarios](https://www.realized1031.com/scenarios)
- [Private Client Program](https://www.realized1031.com/private-client)
- [Realized Exchange Services](https://www.realized1031.com/realized-exchange-services)

### [The Company](https://www.realized1031.com/about-us)

- [The Team](https://www.realized1031.com/about-us)
- [FAQ](https://www.realized1031.com/frequently-asked-questions)
- [Testimonials](https://www.realized1031.com/testimonials)
- [Press](https://www.realized1031.com/press)
- [Careers](https://www.realized1031.com/careers)

### [Partners](https://www.realized1031.com/partners)

- [Financial Advisors](https://www.realized1031.com/advisor)
- [Broker Dealers](https://www.realized1031.com/partners/broker-dealers)
- [Real Estate Agents](https://www.realized1031.com/partners/real-estate-agents)
- [Certified Public Accountants](https://www.realized1031.com/partners/certified-public-accountants)

### [Resources](https://www.realized1031.com/resources)

- #### Learn
  
    - [Articles](https://www.realized1031.com/blog)
    - [Glossary of Terms](https://www.realized1031.com/glossary)
    - [Capital Gains Tax Rates](https://www.realized1031.com/capital-gains-tax-rate)
- #### Watch
  
    - [Video Library](https://www.realized1031.com/videos)
    - [Webinar Archive](https://www.realized1031.com/webinars)
- #### Read
  
    - [Delaware Statutory Trust](https://www.realized1031.com/delaware-statutory-trust)
    - [Tenants-In-Common](https://www.realized1031.com/tenants-in-common-tic)
    - [1031 Exchange](https://www.realized1031.com/1031-exchange)
    - [Qualified Intermediary](https://www.realized1031.com/qualified-intermediary)
    - [Qualified Opportunity Zones](https://www.realized1031.com/opportunity-zones)

#### Realized

- 500 W 13th Street  
  Austin, TX 78701
- (877) 797-1031

##### [Contact Us](https://www.realized1031.com/contact-us)

- [![Realized on Facebook](https://www.realized1031.com/hs-fs/hubfs/Images/UI/Social/Icons/Mix/social-facebook-whiterev.png?width=60&height=60&name=social-facebook-whiterev.png)](https://www.facebook.com/Realized/)
- [![Realized on LinkedIn](https://www.realized1031.com/hs-fs/hubfs/Images/UI/Social/Icons/Mix/social-linkedin-whiterev.png?width=60&height=60&name=social-linkedin-whiterev.png)](https://www.linkedin.com/company/realized/)
- [![Realized on YouTube](https://www.realized1031.com/hs-fs/hubfs/Images/UI/Social/Icons/Mix/social-youtube-whiterev.png?width=60&height=60&name=social-youtube-whiterev.png)](https://www.youtube.com/c/Realized1031?sub_confirmation=1)

- [![Realized Holdings, Inc. BBB Business Review](https://www.realized1031.com/hs-fs/hubfs/Images/professional-assoc/bbb/RZH2-bbb-seal.png?width=40&height=65&name=RZH2-bbb-seal.png)](http://www.bbb.org/central-texas/business-reviews/real-estate-investors/realized-holdings-llc-in-austin-tx-1000112948/#bbbonlineclick)
- [![FEA Logo](https://www.realized1031.com/hs-fs/hubfs/Images/professional-assoc/fea/RZH2-fea-logo.png?width=82&height=65&name=RZH2-fea-logo.png "FEA Logo")](https://www.1031.org)

SECURITIES DISCLOSURE

Realized1031.com is a website operated by Realized Technologies, LLC, a wholly owned subsidiary of Realized Holdings, Inc. (“Realized Holdings”). Securities and/or Investment Advisory Services may be offered through Registered Representatives or Investment Advisor Representatives of Realized Financial, Inc. ("Realized"), a broker/dealer, member [FINRA](https://www.finra.org)/[SIPC](https://www.sipc.org/), and registered investment adviser. Realized is a subsidiary of Realized Holdings, Inc. ("Realized Holdings"). Check the background of this firm on [FINRA's BrokerCheck](https://brokercheck.finra.org/firm/summary/22333).

Hypothetical example(s) are for illustrative purposes only and are not intended to represent the past or future performance of any specific investment.

Investing in alternative assets involves higher risks than traditional investments and is suitable only for sophisticated investors. Alternative investments are often sold by prospectus that discloses all risks, fees, and expenses. They are not tax efficient and an investor should consult with his/her tax advisor prior to investing. Alternative investments have higher fees than traditional investments and they may also be highly leveraged and engage in speculative investment techniques, which can magnify the potential for investment loss or gain and should not be deemed a complete investment program. The value of the investment may fall as well as rise and investors may get back less than they invested.

This site is published for residents of the United States who are accredited investors only. Registered Representatives and Investment Advisor Representatives may only conduct business with residents of the states and jurisdictions in which they are properly registered. Therefore, a response to a request for information may be delayed until appropriate registration is obtained or exemption from registration is determined. Not all of services referenced on this site are available in every state and through every representative listed. For additional information, please contact the Realized Compliance department at 512-472-7171 or info@realized1031.com.

- [Terms & Conditions](https://www.realized1031.com/terms-and-conditions)
- [Privacy Policy](https://www.realized1031.com/privacy-policy)
- [Form CRS](https://www.realized1031.com/hubfs/common-files/disclosures/FormCRS.pdf)
- [ADV 2A](https://www.realized1031.com/hubfs/common-files/disclosures/ADV2A.pdf)
- [Reg BI Disclosures](https://www.realized1031.com/hubfs/common-files/disclosures/RegBI.pdf)
-  

© 2026 Realized Holdings, Inc.

```json
{
  "@context" : "http://schema.org/",
  "@type" : "BlogPosting",
  "articleBody" : "You have a property picked for a 1031 exchange, but want to create a backup plan in case it falls through. In this article, we’ll walk through a few simple options that can be added to your 1031 forms and used as a backup. Increasing Your Probability Of A Successful 1031 Exchange Before looking at a few backup options, let’s first ensure you’re following the three different identification rules for completing a 1031 exchange. In addition to 1031 timeframes, these three rules are some of the most important when it comes to successfully completing a 1031 exchange. 1.) Three Property Rule — the most popular of the three rules, this rule has a built-in backup plan. You must identify up to three replacement properties. You can purchase all of them or just one. If your intent is to purchase one property, the other two properties can be used as backups. 2.) 200% Rule — using this rule, you can identify more than three replacement properties. The catch is that the value of those properties, based on their purchase price, must be less than 200% of the sales price of the property you just sold (i.e., relinquished property). For example, if you just sold a property for $750,000, you can identify up to $1,500,000 in other properties. This might be five $300,000 properties or one $500,000 property and one $1,000,000 property. 3.) 95% Rule — of the three rules, this one is the riskiest. It states that you can identify as many properties as you like but must purchase 95% of their combined value. Being even a little below the 95% mark can disqualify your 1031. For example, this time, you sell a property for $1,000,000. That means you can identify 10 properties worth $5 million collectively, but must acquire $4,750,000 in multiple properties or a single property. DSTs As A Backup Option After reading over the above three rules, your head might be spinning a little. The first two rules may seem very practical, but should you immediately exclude the third rule? Here at Realized, we can help make identifying backup properties very simple. If you want to use Delaware Statutory Trusts (DSTs) as backup options, we can help write out the ID language for you using the most beneficial ID rule for your situation. If you haven’t ever invested in a DST, don’t worry. Realized can help you find a DST that works for your current situation. We’ll help you navigate the above identification rules as well to help ensure a good fit. This material is for general information and educational purposes only. Information is based on data gathered from what we believe are reliable sources. It is not guaranteed as to accuracy, does not purport to be complete and is not intended to be used as a primary basis for investment decisions.",
  "articleSection" : [ "1031 Exchange" ],
  "author" : {
    "@type" : "Person",
    "email" : "marketing@realized1031.com",
    "image" : "",
    "name" : "The Realized Team",
    "url" : "https://www.realized1031.com/blog/author/the-realized-team"
  },
  "dateModified" : "2020-12-03T17:24:39+0000",
  "datePublished" : "2020-12-03T17:24:39+0000",
  "description" : "You have a property picked for a 1031 exchange, but want to create a backup plan in case it falls through.",
  "headline" : "I Need A Backup Strategy For My 1031 Exchange",
  "image" : {
    "@type" : "ImageObject",
    "height" : 435,
    "url" : "https://cdn2.hubspot.net/hubfs/733513/Images/photo/abstract/bull-market-graphs-IS-841214812.jpg",
    "width" : 648
  },
  "mainEntityOfPage" : "https://www.realized1031.com/blog/i-need-a-backup-strategy-for-my-1031-exchange",
  "name" : "I Need A Backup Strategy For My 1031 Exchange",
  "publisher" : {
    "@type" : "Organization",
    "address" : {
      "@type" : "PostalAddress",
      "addressCountry" : "USA",
      "addressLocality" : "Austin",
      "addressRegion" : "TX",
      "postalCode" : "78701",
      "streetAddress" : "500 W 13th Street "
    },
    "logo" : {
      "@type" : "ImageObject",
      "height" : 60,
      "url" : "http://www.realized1031.com/hubfs/Images/Brand/Logo/Realized/Realized-Logo-Black-No-Margin-296x60-AMP.png",
      "width" : 296
    },
    "name" : "Realized"
  },
  "thumbnailUrl" : "https://cdn2.hubspot.net/hubfs/733513/Images/photo/abstract/bull-market-graphs-IS-841214812.jpg"
}
```