Maryland 1031 Husband and Wife

[Weina Shi]

My parents are in the process of selling two properties (single family) and they will close next week. They bought under their own names together. 

They have identified the replacement property (a 5-unit multifamily building) which is inside an LLC (call it ABC LLC). In the state of MD, if a property sits inside an LLC on its own and the buyer buys the membership of the LLC instead of buying the property directly, there is no recordation tax.

Will 1031 exchange allow buying of LLC membership under their own names? What if they each have their own LLCs, and each of these LLCs has a 50%/50% owner of ABC LLC?

Any creative strategy to avoid recordation tax and also permitted by 1031 exchange? Thanks.