Help with Capital Gains Tax?

[Knoell Palmer]

Hey everyone. I kinda have an interesting situation and I'm hoping to get your help. Parents got divorced and in the divorce decree, I was to be gifted a multifamily. The multifamily has been in my Dad's name since the divorce 10 years ago and now we are in the process of selling it. When the sale goes through, I will get any and all profits from the sale. To my understanding, there is a way to "avoid" capital gains tax if I put that money into another property (planning on occupying this property). What exactly does that entail? Does the money have to go towards improvements. Can it go towards the down payment and/or mortgage? Does 100% of this capital gain have to go in the house for it to be valid? Thanks in advance for the clarification!