1031 investment prop to new primary residence?

Question

We have an investment property and a primary residence. I’m wanting to sell my investment property for a nice profit, make my current primary residence a rental and buy a new primary residence. Is there a way to defer the capital gains on the sale of the current investment property with this scenario?

Dave Foster · Answer

@Jenny Pithie, Your intent in doing the 1031 exchange has to be to hold the new property for investment use. But it doesn't have to stay investment forever. As @Natalie Kolodij said, you just have to slow things down a little. Do the 1031. Use the new property for a bit as investment. Then convert it into your primary residence and turn your primary into a rental.

1031 investment prop to new primary residence?

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