1031 exchange question

[Troy Welch]

I am closing on a personal property at the end of August. I am going to move all of my stuff over then list my current home. Can I still do a 1031 exchange?

[Melissa Hartvigsen]

Hello @Troy Welch,

1031 exchanges in the tax code are designed for tax deferral on investment properties though a like-kind exchange, and not personal residences. Generally (assuming the assets are eligible) the exchange must be set up prior to acquiring the new property and disposing of the old property in order to qualify for any exemption. The IRS does not let you do this after the fact.

Gains from the sale of your personal residence may be eligible for a capital gains tax exemption up to $250,000, or $500,000 if the property is jointly owned with your spouse and you file taxes jointly. The IRS has length of ownership rules for meeting this exemption. You can read more here https://www.irs.gov/taxtopics/tc701 and should consult with a CPA if you have further questions. 

Cheers,
Melissa