IRS Okays Limited Personal Use of Property for 1031 Exchange

DebOnTheWeb — Wed, 05 Mar 2008 12:32:34 +0000

At long last, some good news from the IRS. It is now okay to have a limited personal use of a property that you will use for a 1031 Exchange. An exchange allows you to sell a piece of real estate held for investment and purchase another “like kind” property and defer the payment of capital gains. The definition of “Like Kind” means any piece of real estate held for investment, so you don’t have to buy a condo if you sold a condo. This allows you to invest 100% of your equity from your original property into your replacement property.

The new IRS ruling taking place next week allows limited personal use, so as long as you rent out that beach house for most of the year, it’s okay for your family to use it a bit and still do a 1031 Exchange when you sell.

Medford, MA Homes for Sale – Deb on the Web » taxes

IRS Okays Limited Personal Use of Property for 1031 Exchange