Even then, the IRS may scrutinize the transaction if it appears the intent was to immediately convert the property into a personal residence.Additionally, if you eventually sell the property after converting it to a primary residence, you may qualify for partial benefits under the Section 121 exclusion for primary residence gains.

@Les Jean-Pierre Had Section 8 tenants and got a bunch of energy upgrades through a state program.

I found a $600k SFH in Seattle on a corner lot with enough room to build a DADU (will sell for $600k).

If we're talking about some Section 8 houses in Cleveland or Detroit, sure, I am with ya, I live it every day, but what we're talking about right now is a different world.

Cut corners everywhere... are unresponsive.

This not only defers the taxes on the two rental properties but then once they live in the primary residence for at least 2 years that home now qualifies for the Section 121 exclusion on the gain.

Look for ways to increase profits but without cutting corners.

Publication 336 (cash method section) gives a clear example very similar to the situation described where constructive receipt was made because the agent of the taxpayer received payment for the taxpayer. 

SIGNED STATEMENT OF INSURED AS REQUIRED BY SECTION 3905.33 OF THE OHIOREVISED CODEThe named insured ___________, acknowledges that the insurance policy (other than life insurance) as described above is to be placed with an insurance company not authorized to do business in Ohio.The insured understands that the insurance company is not a member of the Ohio Insurance Guaranty Association and that Chapter 3955. of the Ohio Revised Code is not applicable to claimants or insureds of said insurance company.

As a result of being federally charged with these crimes, you may face monetary fines, penalties, prison time and other consequences of Equity Skimming.Equity Skimming and related penalties of sentencing are detailed in 12 United States Code USC Section 1715Z-19.