While it is possible to convert an investment property acquired through a 1031 exchange into a primary residence, this requires careful planning.

The first is that there's no consensus between tax professionals, and the second is that you will not like my personal interpretation.My interpretation is:Until the property is "placed in service" - everything goes into basis.Illustration.You buy a property July 1st.You finish rehab November 1st and put the property on the market.Your tenant moves in January 15th.The property was placed in service November 1st, and it does not matter that the tenant did not move in until the next year.Everything paid between July 1st and November 1st, including interest and utilities, goes into basis.

@Victor Yang To use the rental losses to offset any active income (W2), you'd have meet Real Estate Professional status (which would be difficult to do with a W2 job because you'd have to work more on real estate than any other job to qualify) OR have an AGI of $150K or less.

Readers should seek professional advice.

As always, consult with your licensed tax professional for qualifying, tax implications and strategy.

I kind of like the idea of wholesaling out of state leads, however, with subj to i would be VERY careful who you sell those to. 

If you're insuring a home to replacement cost, insurance companies don't care about appraisals or what the home is worth.  

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

Just cause they make a lot of money doesn't mean they can afford to make mistakes.It's usually these types that are the least careful about their money. 

However, when I’m told on the day of closing they need an appraisal and won’t be funding to close, that isn’t professional.