Best 1031 Exchange Companies in California: How to Compare Them in 2026
California is one of the few states with a law that sets minimum protections for the companies that hold exchange funds. That gives you a concrete way to compare them. Here is what the law requires, the firms that say they have a California office, the questions that separate them, and the California filings that come with any exchange of property in the state.
On this page
The short answer
The best 1031 exchange company for a California sale is one that meets California's exchange facilitator law, shows you in writing how your money is held and who can move it, and gives you a named person who will be there through day 180. Size and location matter less than those three things: exchanges are run by wire, e-signature and phone, so the intermediary does not have to be in your city.
California makes the comparison easier than most states. Under Financial Code §51003, a company acting as a qualified intermediary on California property must at all times keep at least one of these: a fidelity bond of at least $1 million, a deposit of at least $1 million, or all exchange funds in a qualified escrow or trust account that needs your written authorization to release. Ask every firm which one it uses.
What California's exchange facilitator law requires
| Rule | What it says | Section |
|---|---|---|
| Who it covers | Companies acting as qualified intermediaries (or exchange accommodation titleholders) for property in California, or that keep a California office or advertise to the public in California | §51000 |
| Money protection | At least one of: a $1 million fidelity bond, a $1 million deposit, or all exchange funds in a qualified escrow or trust account requiring your written authorization | §51003 |
| Errors and omissions | E&O insurance of at least $250,000, or a $250,000 deposit | §51007 |
| How funds are invested | Held as custodian, invested to a prudent-investor standard for liquidity and preservation of principal; not knowingly commingled with operating accounts or lent to affiliates | §51009 |
| Change of ownership | Clients must be told within 10 business days if more than 50% of the company changes hands | §51001 |
| If something goes wrong | A person harmed can claim on the bond, deposit or letter of credit, and sue | §51005, §51013 |
There is no state license or registration to look up. The law works through these minimums, the duty to keep funds separate, and the right to claim and sue. That is why the documents matter: ask for the bond certificate, the E&O declaration page, or the escrow or trust agreement, not just a sentence on a website.
California 1031 exchange companies: what their sites say
These firms state on their own websites that they have a California headquarters or office. This is not a ranking. Each entry quotes or summarizes the firm's own site as read on October 16, 2026; "not stated" means we did not find it there, not that the firm lacks it. Confirm everything in writing with the firm.
| Firm | California location (as stated) | Funds (as stated) | Bond / E&O (as stated) | CES on staff (as stated) |
|---|---|---|---|---|
| Universal Pacific 1031 Exchange | Headquarters, Los Angeles | Segregated bank account, released on the exchanger's written authorization | E&O of $2 million; bond not stated | Not stated |
| Asset Preservation, Inc. | National headquarters, Roseville; a Stewart subsidiary | Not commingled with the firm's operating accounts | Fidelity bond and E&O stated; amounts not stated | Yes |
| Exchange Resources, Inc. | Corporate headquarters, San Diego | A separate FDIC-insured bank account for each client's exchange | Fidelity bond and E&O stated; amounts not stated | Yes |
| Exeter 1031 Exchange Services | Office in San Diego | Qualified trust accounts | Not stated | Not stated |
| IPX1031 | Offices in San Francisco, San Jose and Yuba City; parent Fidelity National Financial | Not stated on the pages read | $100 million fidelity bond; $30 million E&O | Yes |
| First American Exchange Company | Serves California; no California office address on the page read | Segregated, FDIC-insured accounts | Fidelity bond and professional liability stated; amounts not stated | Yes |
Leah Badach, CES (the author of this page) works with California sellers remotely from Brooklyn, New York. She is a Certified Exchange Specialist with 11+ years of 1031 exchange experience, and the qualified intermediary she works with confirms in writing, before you sign, how your funds are held. Ask her the same questions as everyone else on this list.
How to choose among them
| Your situation | What to weigh most |
|---|---|
| A straightforward sale and purchase, both in California | The §51003 option the firm uses, who can release funds, and one named contact |
| Selling in California, buying in another state | Experience with Form 593 at closing and FTB 3840 every year after |
| Buying the replacement first | Reverse exchange capability and an exchange accommodation titleholder set up before you buy (reverse exchanges) |
| Building or improving on the replacement | Improvement exchange experience (improvement exchanges) |
| A large exchange | Bond and E&O amounts relative to the money held, and how interest on held funds is handled |
| Closing within weeks | How fast the agreement, assignment and closing instructions can be in the escrow officer's hands |
Questions to ask any California intermediary
- Which option under Financial Code §51003 do you use, and can I see the bond certificate or the escrow or trust agreement?
- What is your E&O coverage, and can I see the declaration page?
- Is my money in an account for my exchange alone, and does a withdrawal need my written approval?
- Who earns the interest on my funds, and how is it reported?
- How do I deliver my 45-day identification, and how do you confirm you received it?
- Have you handled Form 593 certifications and FTB 3840 filings for clients who bought out of state?
- Who is my day-to-day contact, and what is their training or certification?
The California filings that come with any exchange
These apply whichever company you choose.
- Form 593 at closing. California generally requires withholding of 3⅓% of the sales price on real property sales, including exchanges. A deferred 1031 exchange is exempt at the initial transfer, but if you receive more than $1,500 in cash or other property from the sale, the intermediary must withhold, and if the exchange fails the intermediary withholds 3⅓% of the sales price (Form 593 instructions). Your escrow officer needs the certification before closing (FTB real estate withholding).
- Form FTB 3840 every year, if you buy outside California. If you exchange California property for property in another state, you file FTB 3840 for the year of the exchange and each later year until the California-source deferred gain is recognized, even after you move away (FTB 3840 instructions; R&TC §18032).
- Why it matters. California has no lower rate for capital gains: "All capital gains are taxed as ordinary income" (FTB). The top bracket is 12.3%, and taxable income over $1 million also carries the 1% Behavioral Health Services Tax, formerly the Mental Health Services Tax (2025 Form 540 booklet).
- Transfer taxes are separate. County and city transfer taxes are imposed on the deed; for Los Angeles see selling in Los Angeles and buying elsewhere.
The federal clocks are the same as anywhere: 45 days to identify replacement property in writing, and the replacement must be received by the earlier of day 180 or the due date, including extensions, of your tax return for the year of the sale (Treas. Reg. §1.1031(k)-1).
Frequently asked questions
Does a 1031 exchange company need a license in California?
No state license or registration was found in California's exchange facilitator law. Instead, Financial Code §51000 and following set minimums: a $1 million bond, a $1 million deposit, or qualified escrow or trust accounts, plus $250,000 of E&O coverage, a prudent-investor standard, and a duty not to commingle funds.
Do I need a qualified intermediary located in California?
No. The intermediary can be anywhere, and most exchanges are run by wire and e-signature. A company that acts as intermediary for California property is covered by the California law wherever it is based, so ask which §51003 option it uses.
What is the largest 1031 exchange company in California?
No public source ranks California exchange volume by firm. Several national firms state California offices, including IPX1031 (Fidelity National Financial) and Asset Preservation (Stewart), whose national headquarters is in Roseville. Size is not the same as protection: ask every firm the same questions.
Is California withholding taken from my sale if I do a 1031 exchange?
Not at the initial transfer, if you certify the exchange on Form 593 before closing. If you receive more than $1,500 in cash or other property from the sale, or the exchange fails, the intermediary must withhold.
Do I still owe California anything if I buy my replacement property in another state?
You file Form FTB 3840 each year until the deferred California-source gain is recognized. When you later sell the out-of-state replacement in a taxable sale, California taxes the deferred California-source gain.
Can the same company do my escrow and my exchange?
A title or escrow company can be your qualified intermediary if it is not a disqualified person, and California's law has its own exemptions for companies acting only as an escrow holder or trustee. Many escrow companies refer exchanges to an affiliated intermediary. Ask who holds the exchange funds and under which agreement.
Sources
- California Financial Code, Division 17, Exchange Facilitators: §51000, §51001, §51003, §51005, §51007, §51009, §51013.
- FTB, 2025 Instructions for Form 593 and real estate withholding.
- FTB, 2025 Instructions for Form FTB 3840.
- FTB, capital gains and losses and 2025 Form 540 booklet.
- Treas. Reg. §1.1031(k)-1: deferred exchanges and qualified intermediaries.
- Firm details: each firm's own website, linked in the table, read October 16, 2026.
Educational information, not tax or legal advice. Firm details are as stated on each firm's website and may change; confirm them in writing.
Selling California property?
Tell Leah where the property is, when you expect to close, and where you might buy. She works with investors in all 50 states, including California.
Talk to Leah