Please help on quick 1031 question
1031 Like-exchange question.
Bought 10 wooded acres 20 years ago for 10,000. Say the city purchased 1 acre of this property recently for 100,000 under eminent domain. I apply to like exchange that amount into a strip shopping center on 5 acres of land costing 1,000,000.
The Question is, if I follow all the proper rules and deadlines, would I be able to transfer the entire 100,000 (tax free) into the new property? Or would I have a tax liability on part of it because of the lower purchase price of the original property or the fact that the original property was divided (not sold to the city in entirety) or for something else?
Thank you all SO Much for any advice as I have heard various opinions from local friends and I find the IRS examples/procedures difficult to follow and understand.