Can I use a 1031 on the sale of my primary residence?

[Jillyan MacMorris]

I own and live in a condo, but my building is being sold in a deconversion! An offer has been accepted and I we are in the 60-day closing period as we speak. Can I use a 1031 exchange on my primary residence to purchase a new primary residence? Or only on investment properties?

I purchased my existing condo as my home, but started renting it out on AirBnb a few months ago. Would it then count as a rental property for this purpose? I intend to house hack the next property, opting for an owner-occupied conventional loan. Does a 1031 only apply for loans on properties which are 100% rentals from the start?

[Bill B.]

The loan type doesn’t affect a 1031. But this is obviously your primary, so no 1031. You don’t want a 1031 anyway, that only defers the taxes. You get the first $250k in capital gains tax free ($500k if married) on your primary. Most people are trying to do the opposite. Change their rental in to a primary for tax purposes. 

If you’re going to gain more than $250/$500k talk to a tax consultant about rounding up any receipts that could prove deductible.  (Some loan costs, selling costs, capex, etc…)