1031 exchange to purchase a fix and flip

[Leo B.]

Hello all-

Would I be able to purchase a fix and flip project with 1031 proceeds? Below is just an example of a scenario.

Original purchase price of rental home is $425K

$400K loan balance

$500K sale

$15K closing costs

$85K net proceeds

Would I be able to use the $85K to 1031 exchange and purchase a fixer for $415K and needs $85K of work and still defer taxes?