Now you could accrue earnings and pay tax, but accrual is not customary as mortgages default.That's my understanding, I've never dealt in a note without a payment being due with only accrued interest for two or more years, I'm not certain there isn't special tax treatment for accrual.

PP to closing is only possession, local custom dictates treatment, as month to month rent.

Going through bankruptcy, getting laid off, both parents going through C treatments.. then Mom passed..

If you want separate liability treatment you have to treat the assets, income, and expenses of each LLC separate.

It sounds like your time horizon window is long and that would qualify  you for 1031 treatment.  

Hi @Aashiq Dheeraj, There is no specific or required holding period in order to qualify for 1031 Exchange treatment.

@Chris Mason the reason the spouse was left off is because of the pass through treatment of LLCs/sole proprietorships and the combination of being married.One way to get the treatment the OP is seeking is to set up separate C-Corps that provide services to each other.

Usually it means double commision for him/ her and i get the best treatment and most likely the property ( even if there are bidding wars and myltimple offers).

thanks @Brett Goldsmith - they have serious (real) medical issues and need 3 months of treatment to resolve.

I am not a CPA...I do believe that both of those incomes would be considered passive investment income and your tax treatment would be identical.