If your client already has the proceeds form the sale in her possession she cannot do a 1031 exchange. The proceeds from the sale would have needed to be deposited with a qualified intermediary who would have then used those funds to purchase any properties within the exchange and any leftover proceeds would be provided to the Seller.
There is a very structured way to accomplish an exchange and it begins with the contract for the sale of the initial property.
If the proceeds of the sale are from a personal residence where the Seller(s) has/have lived for 2 of the previous 5 years, then $250k of the capital gain is tax-free. If the Sellers are married and file jointly, each has a $250k capital gain tax-free allowance for a combined $500k.
For more information on 1031 Exchanges: www.apiexchange.com
