Can I do a 1031 trade for a just-constructed property to be used for rental purposes?
November 13, 2002
Date: Thu, 10 Oct 2002
Would it yet be possible to do a 1031 trade with a rental property for a just-constructed property (residence not built by me, the potential buyer) to be used for rental purposes? Or would it have had to be rented already?
Date: Fri, 01 Nov 2002
Yes, provided you don't use the property as a personal residence and start renting it shortly after the exchange is completed. (The replacement property can even have been someone else's principal residence and converted by the buyer to a rental after the exchange is completed.)
We have more answers to frequently asked real estate tax questions! We also offer up-to-date information about new tax real estate tax developments in Michael Gray, CPA's Real Estate Tax Letter.
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