I'm about to put a house (flip took longer than a year) on a market. I signed a contract for different real estate unites (a group of 14 small houses for rentals) closing in September. Can I sill use 1031 exchange? If so what are the steps I need to take?

Hi Sheba,

You have an interesting situation before you.  1031 exchanges are meant only for property where your intent has been to hold it for productive use in business trade or for investment.  So rental property or property where your time horizon was long.  While you have owned the property for quite a while (most conservative folks out there say more than a year is good) you describe it as a flip which could indicate that your primary intent all along was to fix only to sell.  So in one sense your actions say that you held the property but your other actions say that your intent all along was to sell which would not qualify for 1031 treatment.

I would talk to your accountant.   Look at how you've treated this property on your tax returns.  Eliminate the word "flip" from your vocabulary.  It's perfectly fine to buy a property to hold and then later change your mind but the key is to be able to explain it if ever questioned.  

The other side of this is the timing.  You must sell the old property first before you buy the new property.  So as long as you can market and sell your house before the Sept purchase you could still to the 1031 from a timing perspective.  The key is that you must have the 1031 and your qualified intermediary in place prior to that sale.