HELOC used for 1031 exchange.

[Ravi Ramphal]

Hi, I currently own a property that I would like to take a HELOC in to purchase investment property. Does this strategy avoid paying capital gains due to 1031 exchange ?

[Wayne Brooks]

@Ravi Ramphal Financing has no effect on gain/taxes whatsoever....it is ignored in the profit/gain calculation.  It’s cost basis verses sales price(less closing costs/fees).