Friend had a rental home in Bay Area; based on someone’s suggestion he did a 1031 exchange to a new home (sold the old one) and moved into new one, questions, - is he entitled to pay capital gains tax on the gain upon sell-transaction - if yes, is there any alternative to avoid it.. Anyone in this situation before, Any implications, any suggestions...
I think he is not supposed to move into the new home for one year if it's a 1031 Exchange. You can only do "like kind exchange" from investment property to investment property, not primary residence.
Call a CPA. Moving into the new home violates 1031-exchange rules.
He has to pay taxes. Rental and primary residence are not like buildings for a 1035
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Not if he re-invested all the proceeds into the new home