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I am sorry, I had some personal matters that I had to attend to.
A personal residence does not qualify for an exchange. However, if you exchange an investment or rental property
, you can then convert that to personal use. There is no specified time period as to how long it has to be rented or, if not rented, "available" for rent. There is a rule that states
that if you do convert a §1031 property to personal use, you have to hold it as your principal residence for 5 years (not the 2 generally used) in order to claim the $250k/$500k exclusion that is allowed under IRC §121.
I tend to be somewhat conservative on issues such as this, so I would try to rent it out for 6-12 months or so. If it is available for rent, you can still deduct the expenses, even though there is no income
to offset. This can, depending on your other income
, offset some of your wages or other income.
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