Would transferring the property to an LLC impact my eligibility for Section 121?

Transfer of beneficial interest DOES violate the due on sale clause.  

Meanwhile, Partner A’s Spouse is willing to transfer their 50% share to the Children but wants to retain a steady monthly income from the rental properties.Key Facts:Each rental unit currently generates $550/month, but market rates suggest it could be raised to $850/month.The Children will buy Partner B’s 50% interest using a bank loan at 7% interest.After the purchase, the Children plan to pay a minimum of $1,500/month toward the loan while holding excess cash in a reserve account.There are 3 properties.

I had done nothing to hide the transfer of title.

Since your rental is currently held in your personal names, transferring it to an LLC before selling could complicate the exchange.

Once you move out, you can transfer it into an LLC—just check with your lender first.

@James Thompson Transferring property from your in-laws to you can be done through a gift, sale, or trust transfer, each with different tax implications.

Given that I’m currently unemployed, I’m leaning towards a fix-and-flip to generate some liquidity.Here’s my current situation:My first investment property (the duplex) was purchased using a HELOC from my mother’s primary residence (via Union Savings Bank), and the deed is currently in her name.I also secured a second HELOC against the investment property to cover contractor expenses.I'm considering transferring the property into a DSCR loan under an LLC, but I believe this would close out the second HELOC—can anyone confirm if that’s correct?

--I transferred all of my rainy day cash to the loan to get the balance down.