Not sure if this makes sense, here is my grand plan
1) Buy few Duplexes/Fourplexes that give cash flow (around 5, and as many as possible)
2) 20 years later with substantial appreciation, use 1031 to buy a million dollar home.
3) rent for reasonable period, say 2 years
4) MOVEIN to the home, to make it primary residence.
5) After 2 years SELL. no tax for first 500K. HURRAY!!!!
Any loopholes in the plan?
Great plan but here's a couple of thoughts
1. You will also have to recapture depreciation for the years your property was in service.
2. This is only under current law. And as Attorney Gideon Tucker once said, "No man's life liberty or property are safe while the legislature is in session."
Thanks Dave for the response.
At what point do you think is becomes a must to recapture depreciation ?
When I convert to 1031 ? or when I make the bigger investment home into my primary residence?
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