Primary SFH to rental conversion - Sec 121 1099-S advantage

[Paul Fernando]

Been reading the forum for months now but this is my first post because, honestly, any question I had so far was already answered on this forum! Many thanks to all you active members!

My wife and I own a SFH in a Boston suburb. We were lucky enough to purchase the property in 2012 so the property has appreciated over $200K since then. It's been our primary residence from 2012 to date.

We've saved up a chunk over the last few years and want to move to a new SFH.

Instead of upgrading to a larger house (letting hard-earned $s sit idle in unused space), we’re considering converting our current home to a rental and moving into a similar home.

My question is, how do we execute on the $250K/$500K cap gains exemption (Sec 121) prior to converting our primary SFH to a rental?

A BP post mentioned an IRS 1099-S is required to execute Sec 121.

If I quitclaim the property to an LLC would I generate the 1099-S?

Does anyone have any experience overcoming this challenge?

Thanks!

Paul