@Emily Gowen so as you pointed out you would not have to do a 1031 exchange on your current home to avoid the capital gains tax and coupled with what Dave Foster pointed out I think, speaking from experience you would have a high likelihood of success. 

Call the registrar and ask. 1-800 321-2752 https://www.cslb.ca.gov/newsletter/2010-summer/page9.htmThe current text of ab968 requires FULL disclosure with copies of all contracts, permits and warranties within the two year window.

We're exploring creative ways to provide him with the cash needed for the down payment while avoiding triggering a taxable event.One strategy we're considering is purchasing his future primary residence ourselves, making the mortgage payments, and then, once we've built enough equity—comparable to the appraised value of his rental properties—transferring the title to him as a form of exchange.What are your thoughts on this approach?

A standard 1031 exchange requires that the same entity selling the property also acquires the replacement property, which becomes challenging when proceeds are split between partners.Potential Strategy: "Drop and Swap"One approach is the "Drop and Swap" method:- Convert Ownership: Before the sale, the LLC distributes the property to the partners, converting joint ownership into individual tenants-in-common (TIC) interests.- Individual 1031 Exchanges: Each partner can then independently conduct a 1031 exchange with their share, deferring capital gains taxes by reinvesting in like-kind properties.Considerations:- Timing: The IRS may scrutinize transactions where the "drop" (distribution) and "swap" (exchange) occur in quick succession.

The only thing the bank required is that I had a checking account with direct deposit setup into their account. 

If I understand the Act correctly, the regulation allow one spouse transfer loans to another spouse keeping the existing terms without the regular qualifying requirements.

I saw how that proposal is basically her giving me a 0% loan, but at the same time I believe that structure will avoid her taking a large loss (approximately 30k if she accepts a 300k offer).I do not know why she doesnt get a PM, I only share the facts of when she purchased it, the purchase price, and the reasoning she shared with my realtor as to why she is selling after such a short time period.

Managing a large renovation budget required careful oversight to stay on track.

--Financing:I would like to do 20% down, or more if needed, but I would like to avoid 100% cash offers as it would likely be the majority of my liquid assets.Question: How does financing differ from the mainland?

This was a great way to keep the home in the family and avoid the house going into tax foreclosure.