Capital gains tax on a four unit that I lived in for 4 years-1031

[Thomas Bryan]

Hello BP! I have a few questions regarding the sale of my four unit apartment that should be a CPA's dream! I bought the building in 2013 for 74,000 as a three unit that needed work. I since converted it into a four unit and lived in one of the units from 2013-2017. I now have a buyer interested in the property for 165k. So... (1) Since I lived in the property for two of the last five years am I exempt from all of the capital gains, or a quarter of the gains? (2) I have a HELOC (home equity line of credit) on the property that I did not utilize. Can I use the HELOC before the sale to add more debt to the property to lessen the gains? Is that frowned upon? (3) I will be looking to do a 1031 exchange if I need to. The purchase I have in negotiation would be a portfolio of several rentals that would be purchased under owner financing. Can I still utilize a 1031 exchange for the down payment to the seller with a seller financed deal? Any help on this would be greatly appreciated!

Thanks!

Tom Bryan