So I said its probably best to just pay the tax.If an investor overpay a ton, just to save on taxes, most likely they'll be inflicting significant financial damage to their portfolio… it’s probably best to opt out and pay the tax.1031s aren't structured in a way that makes someone "overpay" - it mainly comes down to poor planning which puts them in that situationNever let the tax tail wag the dog!

I'm looking to connect with experienced investors, realtors specializing in investor purchases, and reliable property management companies.I'm also open to discussing neighborhoods and real estate tax strategies.Let's chat!

I don't think I qualify for any conventional or FHA loans as I don't have long enough income history.

A $114k deduction in that tax bracket would be about half that in tax savings, no?

Tough decision but eventually went with Digb because they also help with taxes and planning.   

Form an LLC:Purpose: Establish a separate LLC for the rental portion of the unit.Ownership: Lease the rental space to the LLC, which will handle all rental income and expenses.Lease Agreement:Internal Lease: Create a lease agreement between myself (as the homeowner) and my LLC (as the tenant renting the rental space).

The fact is, I need the extra income STR rentals bring in and don't want to leave any money on the table.

You can't deny based on non paycheck income source. 

Nelson Nash developed the concept in the early 80s but the product the concept utilizes has been around for much, much longer.Since you brought up term insurance (which is temporary w/ no cash value accumulation or dividends), oftentimes a policy will be supplemented by term insurance in the form of a rider that allows one to increase their death benefit such that they can store more cash in their policy without triggering IRS MEC limits and therefore be subject to tax hits.The concept and its value proposition is incredibly misunderstood (and sadly often abused) but the reality is it works.

Ask yourself what you are looking for (cash flow, appreciation, tax benefit, etc).