Interview script · not tax or legal advice
Questions to ask a qualified intermediary
These are sentences to send before you sign the exchange agreement — not a ranking and not a script that “clears” a firm. A Qualified Intermediary is a custody counterparty. There is no federal QI license. Unknown answers stay unknown. Print theten-item checklistif you want boxes; this page is the spoken version. Compare published custody facts in thedirectory.
1. Who is on the exchange agreement?
“What is the exact legal name of the entity that will be the qualified intermediary on my exchange agreement, and in which state is it formed? Is that the same entity that will be on the account title?”
Marketing brands, “a member of the X family,” and a parent ticker are not the contracting party. Treas. Reg. §1.1031(k)-1(g)(4) is about whether an intermediary is a qualified intermediary for the safe harbor — it is not a charter for a trade name.
2. What will the statement say?
“Please send the exact account title and TIN as they will appear on the bank or trust statement for this file, and a redacted specimen if you have one.”
If the firm uses a qualified escrow or qualified trust, ask it to say so in those words and to name the escrow holder or trustee. Those structures are defined in Treas. Reg. §1.1031(k)-1(g)(3). Seequalified escrow vs qualified trust.
3. Segregated, aggregated, or operating?
“Will my proceeds sit in an account identified to this taxpayer, in a qualified escrow or trust, or in a pooled account with a subledger? Are they ever deposited in your operating account?”
Several state facilitator statutes forbid commingling with operating funds and still allow aggregation with subaccounting. That is not the same sentence as “I can see my TIN on a bank statement.” Longer treatment:segregated vs commingled vs dual-signature.
4. Who can move the money?
“Who is authorized to instruct a disbursement? Can a single employee release funds? Does the deposit bank require dual written authorization, and at what amount? Is the second signature the taxpayer, a second officer, or an independent escrow/trustee?”
Treas. Reg. §1.1031(k)-1(g)(6) limits the taxpayer’s ability to receive, pledge, or borrow the cash mid-exchange. Dual-signature is often about whether the QI can move it alone. Ask both directions.
5. What coverage is in force today?
“Please send current certificates — fidelity / crime and E&O — not the brochure numbers. Who is the named insured? What is the deductible? Does the certificate mention social-engineering or funds-transfer fraud?”
The QI File does not invent bond or E&O limits. If a firm’s listing is blank, that is unpublished, not a hidden zero.
6. Which state statute, if any?
“Which exchange-facilitator or escrow statute do you say applies to this file, and which financial-assurance alternative are you using — bond, cash/LOC, or qualified escrow/trust with dual authorization?”
There is no national license. Deep pages for cited states start atstate QI statutes.
7. Company FEA vs person with CES
“Is the company a current Federation of Exchange Accommodators member? Will a named CES® holder work this file? Can I verify both on 1031.org?”
FEA describes itself as the national trade association for the 1031 industry. Membership and CES are association facts, not a government charter (1031.org/about-fea, accessed 2026-09-08).
8. Can you document the exchange type I actually have?
“If this is a reverse or parking exchange, will you document a QEAA under Rev. Proc. 2000-37, and have you read Rev. Proc. 2004-51 against these facts? If this is an improvement exchange, who controls draws? If replacement is a DST interest, who is the issuer — because that is typically a securities offering, not QI custody?”
9. Who keeps interest?
“Who is entitled to interest or float on the exchange account, at what rate if any is credited to me, and is that in the exchange agreement or a separate schedule?”
Published dollar cards, where they still exist, are collected onQI fees. Most firms stay unknown. Do not accept a verbal “industry standard.”
10. How do I verify the account without calling your cell phone?
“Give me written instructions to confirm the account title, TIN, and authorized-signer list with the bank or trustee using a number or portal I look up independently — not a callback number from an email.”
Social-engineering wires are a different failure mode from insolvency. Independent verify is how you test the story before the relinquished-property closing.
FAQ
Is there a federal list of licensed qualified intermediaries?
No. IRC §1031 and Treas. Reg. §1.1031(k)-1 define when an intermediary is a “qualified intermediary” for the deferred-exchange safe harbor. That is a tax-characterization rule, not a federal license or roster. Ask the firm which state facilitator statute, if any, it says applies to your file, and verify the statute yourself.
What is the single most useful written ask before I wire?
Ask for the exact account title and taxpayer identification number as they will appear on the bank or trust statement, plus who must authorize a disbursement. If the QI cannot put those two facts in writing, the rest of the brochure is not a custody file.
Should I treat FEA membership or a CES name as the diligence answer?
No. The Federation of Exchange Accommodators is a trade association. CES® is a personal designation. Ask whether the company is a current member and whether a named person on your file holds CES, then verify on 1031.org. Neither fact is a government charter.
Related
Sources
- Treas. Reg. §1.1031(k)-1 — law.cornell.edu/cfr/text/26/1.1031(k)-1. (g)(3) qualified escrow/trust; (g)(4) qualified intermediary; (g)(6) taxpayer-benefit restrictions. Accessed 2026-09-08.
- Rev. Proc. 2000-37 — irs.gov/pub/irs-drop/rp-00-37.pdf. Reverse / parking QEAA. Accessed 2026-09-08.
- Rev. Proc. 2004-51 — irs.gov/pub/irs-drop/rp-04-51.pdf. Parking safe harbor limitation. Accessed 2026-09-08.
- Federation of Exchange Accommodators — 1031.org/about-fea. Accessed 2026-09-08.
This page is not tax, legal, or investment advice.