Taxes - 1031 Exchange

[Elena Mafla]

When using a 1031 exchange form, do you have to use the full cash amount you are getting from the sale transaction , or can you use just minimum required for the new purchase. Sample; capital gain is $150K minimum down for the new investment is 25% or $80K, Do you have to use the full $150K or can you just use the $80K for the new investment?

[Bill B.]

Hopefully @Dave Foster will chime in if I’m wrong but my understanding is you’ll be taxed on cash you keep or any lower balance mortgage you obtain. “Boot” so if you pay off a mortgage and get a smaller one you will pay tax on that difference a well as on the cash you keep.