95% Rule

Ninety five percent rule coverage supports Fort Worth, Texas investors who need to identify replacement property with a combined value exceeding two hundred percent of the relinquished property, a less common scenario that requires acquisition scheduling discipline since this rule demands the investor actually acquire at least ninety five percent of the total value identified, not merely identify it. Because this exception carries a higher bar than the three property rule or the two hundred percent rule, we build acquisition scheduling specifically designed to satisfy the ninety five percent threshold within the one hundred eighty day closing window.

Understanding When The Ninety Five Percent Exception Applies

The ninety five percent rule is used when an investor's identification list exceeds both the three property limit and the two hundred percent value cap, which can happen when an investor is genuinely evaluating a large number of candidates or spreading a large relinquished property sale across many smaller acquisitions. Unlike the three property rule or the two hundred percent rule, where an investor only needs to close on some of the identified properties, the ninety five percent rule requires closing on properties representing at least ninety five percent of the aggregate value of everything identified, making the acquisition scheduling far less forgiving if a deal falls through.

Scheduling Acquisitions To Hit The Threshold

We build an acquisition schedule that maps every identified property against the one hundred eighty day deadline, tracking which combination of closings would satisfy the ninety five percent threshold if one or more candidates fall out of contract along the way, since the investor needs a realistic path to the threshold even accounting for typical deal attrition. This scheduling requires closer coordination with lenders, title companies, and sellers across multiple simultaneous transactions than a standard three property or two hundred percent rule exchange, since timing several closings to land within the same window, while still hitting the value threshold, takes active project management.

Investors considering the ninety five percent rule in Fort Worth should understand this is capital stack exceeding two hundred percent territory, meaning the strategy only becomes necessary when an investor's search has already produced an identification list too large for the more commonly used rules, and we help investors evaluate whether narrowing the list to fit the two hundred percent rule instead might actually be the simpler path before committing to the stricter ninety five percent threshold.

We also help investors model realistic attrition rates based on typical deal fallout experienced across a portfolio of simultaneous acquisitions, since assuming every identified property closes without issue is rarely realistic, and building the acquisition schedule around a more conservative assumption, accounting for one or more candidates falling out of contract, better protects the investor's ability to still reach the ninety five percent threshold even if the search does not go perfectly according to plan. We also review financing capacity across the full slate of properties being pursued, since closing on enough properties to satisfy the ninety five percent threshold may require coordinating multiple loans or a larger blanket facility, and confirming lender capacity and willingness to close multiple simultaneous transactions early in the process avoids discovering a financing shortfall late in the one hundred eighty day window. For investors who find the ninety five percent threshold genuinely difficult to reach given how their search has evolved, we also help evaluate whether accepting a partial exchange, deferring gain only on the portion successfully reinvested while recognizing gain on the remainder, might be a more realistic outcome than forcing an aggressive multi property closing schedule to hit the full threshold.

We also track how partial closings on individual properties affect the running total toward the ninety five percent threshold in real time, updating the acquisition schedule as each closing completes so the investor always has a current, accurate picture of how much identified value has actually been acquired relative to how much remains needed to satisfy the exception.

This service provides educational and administrative coordination support only, working alongside the investor's own attorney and certified public accountant, and it is not tax, legal, or investment advice. Because Texas has no state income tax, the deferral achieved applies to federal capital gains tax and federal depreciation recapture only.