A 1031 exchange (named for Section 1031 of the IRS tax code) allows real estate investors to defer capital gains taxes when selling an investment property, provided they reinvest the proceeds into a "like-kind" replacement property within strict time limits: 45 days to identify the replacement property and 180 days to close on it. To fully defer all taxes, the replacement property must be equal to or greater in value than the relinquished property, and all equity must be reinvested. Any cash or debt relief received ("boot") is taxable.