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I have an investment property where I have a capital gain of approximately 700k with no mortgage.

I understand that you can move into an investment property, convert it to your primary residence and stay for multiple years before selling it to get a capital gains tax exception.

Can I 1031 exchange my current property into two properties, proportionally distributing the capital basis, then move into one of them for five years and sell it. And then move into the other one, stay for five years, and sell that too? Taking the tax exemption twice?

Matthew
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1 Answers1

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I understand that you can move into an investment property, convert it to your primary residence and stay for multiple years before selling it to get a capital gains tax exception.

You understand wrong.

The Sec. 121 exclusion that you're referring to specifically addresses this situation. See the IRC Sec 121(b)(5).

littleadv
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