rent to own 1031 exchange and mortgage

[Josh Dillingham]

In December I bought a single family home, all cash, which was in rough shape and had been vacant for over a year. I had the intent of fixing it up, renting it for a couple years then selling it. I have it advertised to rent now and I've got someone who is potentially interested in purchasing the house outright or doing a lease option. my questions are: 1.) if I sell it out right, only having owned it for 4 months will I get slammed with self employment tax and regular income tax and not be eligible for 1031 exchange. or could I still call it an investment property and be able to 1031 because my intent was to rent it? 2.) if I lease option it with a 2 year option will I be able to 1031, or not because my intent from the beginning of the lease option is to sell it? 3.) I don't currently have a mortgage on the house, if I set up a lease option would that stop me from taking out a mortgage so I can pull out my forced equity from all my improvements to the property so I can roll it over to a down payment for another investment? thanks! Josh Dillingham Brattleboro, vermont