Using a portion of the proceeds of a 1031 to pay an exsiting 1031

[Philip Davis]

My wife and I successfully executed a 1031 (A) by selling one rental property in CA and buying two in VA two years ago. These two properties each required mortgages to be taken. A recent death in the family now forces us to make a decision as to the disposition of an inherited property. Executing another 1031 (B) is our preferred choice. I see our course of action options as:

1.  Use the proceeds of 1031 (B) to pay-off the mortgages of 1031 (A), as well as purchase another property.

2.  Use the proceeds of 1031 (B) to purchase other properties, leaving the existing mortgages in place.

3.  Maintain the property as is.

4.  Sell the property and pay the taxes.

If anyone knows of other options or has any sage advice, we'd greatly appreciated!