1031 exchange with some use as principal residence.

Dear 1031x:  I plan to sell rental home, pay off existing 78k mtg use profit to buy medical condo.  ?our rental was empty last Nov04 thru Mar05, and we went there while our  new home we are in now was under constriction.  qualify 1031????

 

Dear Dr. T:  Thank you for contacting us.  1) Remember you must trade equal or up in value to fully defer.  Reinvesting just the gain will not completely defer. 2) Your short term use of the property as a residence while your home was being completed will NOT disqualify this property from 1031x deferral.  I hope we can help.  Sincerely,

Steve Hickox
Attorney / President