I have a rental property that I wish to sell and upgrade to a duplex. I have land in my possession and need to know if IRS like kind rules allow me to construct a duplex on the property. Does this qualify under the rules?
@Wayne Walker , Unfortunately you cannot use a 1031 to purchase improvements on land you already own.
There is a special kind of exchange that allows you to control a lot while a building is built on it and then you exchange for both. It is called a reverse or construction exchange. But in your case you already own the lot so that option is out.
Like kind means that you must sell investment real estate and take deeded possession of investment real estate.
Do you have to have the purchase identified at time of sell of existing property? If not how long do you have to do that and to close the purchase?
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