What a QIT account is and whether your bank offers the conversion

A may have access to Intermediary Trust (QIT) account is a special type of checking account designed to hold money temporarily during a 1031 exchange—a real estate transaction where you sell one property and buy another similar one without paying capital gains tax in between. The account holds the sale proceeds in trust so you cannot touch the money yourself, which is required by tax law.

Most regular banks do not offer QIT accounts because they require specialized compliance and trust administration. Instead, QIT accounts are typically opened through may have access to intermediaries—companies licensed specifically to handle 1031 exchanges. Your current bank almost certainly cannot convert your existing checking account into a QIT account; you will need to open a new account with a may have access to intermediary firm.

If you are in the middle of a 1031 exchange and need a QIT account, you cannot use your personal checking account for any part of it. The IRS rules are strict: the money must sit in an account you do not control, held by a third party, from the moment you receive the sale proceeds until you close on the replacement property.

Key Takeaways

  • Regular banks do not convert checking accounts to QIT accounts; QIT accounts must be opened with a may have access to intermediary firm that specializes in 1031 exchanges.
  • A QIT account is a trust account that holds sale proceeds during a real estate exchange, and you cannot access the money yourself under IRS rules.
  • You need a may have access to intermediary to open a QIT account, not your personal bank, because the intermediary must be a licensed third party.
  • If you already received sale proceeds in your personal checking account, you may have violated the 1031 exchange rules and should contact a tax professional immediately.

Why your bank cannot create a QIT account from your existing account

A QIT account is not just a different account type or a checkbox your bank can flip. It is a trust account that must be held by a may have access to intermediary—a person or company licensed and bonded to manage 1031 exchanges. The intermediary holds legal title to the money on your behalf, which means your bank cannot simply redesignate your account because your bank is not a may have access to intermediary.

Banks handle regular checking and savings accounts where you own the money outright. A QIT account is the opposite: you do not own it, the intermediary does, and you have no legal right to withdraw from it. This separation is what makes the 1031 exchange work under tax law. Your bank lacks the licensing, bonding, and compliance infrastructure to serve as a may have access to intermediary.

If you are planning a 1031 exchange, you need to find a may have access to intermediary before you close on the sale of your current property. The intermediary will open the QIT account for you, and the sale proceeds will go directly into that account from the title company or escrow agent.

How to find and open a QIT account with a may have access to intermediary

Start by searching for "may have access to intermediary 1031 exchange" in your state or region. The Federation of Exchange Accommodators (FEA) maintains a directory of may have access to intermediaries, though not all intermediaries are members. You can also ask your real estate agent, title company, or tax professional for referrals—they work with intermediaries regularly and can point you toward reputable firms.

When you contact an intermediary, tell them you are selling a property and need a QIT account. They will explain their fees (usually a percentage of the sale proceeds or a flat fee), walk you through the paperwork, and give you instructions for the title company or escrow agent to send the proceeds to the QIT account instead of to you. The intermediary will also explain the 45-day identification period and the 180-day closing deadline that apply to all 1031 exchanges.

You do not open the account yourself. The intermediary opens it in their name as trustee, with your sale proceeds deposited directly. Your only role is to sign the paperwork and provide the intermediary with the details of the replacement property you want to buy within the required timeframe.

What happens if you already deposited sale proceeds into your personal checking account

If you have already received the sale proceeds from your property sale and deposited them into your regular checking account, you may have disqualified yourself from the 1031 exchange tax benefit. The IRS requires that you never have actual or constructive receipt of the money—meaning you cannot touch it, control it, or have access to it at any point during the exchange period.

Contact a tax professional or CPA immediately. Depending on how much time has passed and what you have done with the money, there may be options to salvage the exchange, but this is not something to handle on your own. Some intermediaries can still help if the money has not been spent, but the rules are complex and state-specific. A tax professional can review your situation and advise whether the exchange is still possible.

The timeline for opening a QIT account and closing the exchange

Once the may have access to intermediary opens your QIT account and the sale proceeds are deposited, you have 45 calendar days to identify the replacement property or properties you want to buy. You do not have to close on them in 45 days—you just have to name them in writing to the intermediary.

You then have 180 calendar days total from the date you sold your original property to close on the replacement property. The 180-day clock includes the 45-day identification period, so you actually have about 135 days after you identify the property to close. The intermediary will hold the money in the QIT account until you close on the replacement property, at which point the funds are released to pay for it.

If you miss either deadline, the exchange fails and you owe capital gains tax on the sale proceeds. The intermediary cannot extend these deadlines, and neither can your tax professional. These are IRS rules, not bank rules.

Fees and costs for a QIT account

may have access to intermediaries charge for their services. Fees vary widely depending on the firm and the size of the transaction. Some charge a flat fee (ranging from a few hundred to a few thousand dollars), while others charge a percentage of the sale proceeds (typically 0.5 to 1 percent). A few charge both a flat fee and a percentage.

Ask the intermediary for their full fee schedule upfront, including any charges for wire transfers, document preparation, or extension requests. These fees come out of your sale proceeds, so they reduce the amount available to buy the replacement property. Factor them into your exchange planning.

Your bank cannot charge you to convert an account to a QIT because, again, your bank cannot create a QIT account. The only fees you pay are to the may have access to intermediary.

Frequently Asked Questions

Can I use my regular checking account as a temporary holding place for the sale proceeds?

No. The IRS considers any time you have access to the money as receipt of it, which disqualifies the exchange. The proceeds must go directly from the title company or escrow agent into the QIT account held by the may have access to intermediary. You cannot deposit them into your personal account first, even for a day.

What if I want to do a 1031 exchange but my bank says they can help?

Your bank cannot serve as a may have access to intermediary for a 1031 exchange. If a bank employee suggests they can hold the money for you in a special account, that is not a QIT account and will not satisfy IRS requirements. You must use a licensed may have access to intermediary firm.

Can I change my mind and use the money for something other than buying replacement property?

Once the money is in the QIT account, you cannot access it for any other purpose without disqualifying the exchange and owing capital gains tax. The intermediary will not release the funds except to close on the replacement property or to return them to you (which triggers the tax bill). This is by design—it is what makes the 1031 exchange work.

Do I need a QIT account if I am doing a delayed exchange?

Yes. All 1031 exchanges require a may have access to intermediary to hold the sale proceeds, whether you are doing a delayed exchange (the most common type), a simultaneous exchange, or a build-to-suit exchange. The intermediary and the QIT account are not optional.