Transfer of Property, 8% of the examination
Section 1031 exchange
A deferral of capital gain tax when investment or business real property is exchanged for like-kind real property.
It defers gain rather than eliminating it, and the basis carries over into the replacement property. The deadlines are strict: identify the replacement within 45 days and close within 180 days. Since 2018 it applies only to real property, and boot received is taxable to the extent of gain.
See it in a question
One question from Transfer of Property, so the term lands in the context the exam uses it in.
What is the essential function of an escrow in a California transaction?
Written to DRE's published topic list. Not a real examination question, since reproducing those is a misdemeanour under B&P Code section 123.