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Unfortunately you cannot avoid capital gains by paying off another one property. However, there might be a solution. Did you use the house you plan to sell as your primary residence for at least 2 out of last five years?
You can exclude up to 250K of capital gains (500K if married filing jointly) if owned the property and it was your principle/primary residence for at least 2 out of 5 years immediately prior to sale and you didn't use the exclusion in the last two year.
There's also long term capital gain favorable tax treatment, if you are in 10 - 15% tax bracket, your capital gain rate is actually 0, no tax on capital gains. In higher tax brackets, except the highest one, your capital gain rate is only 15%.
The tax provision that allowed to postpone capital gains by re-investing it into another property had been replaced by the 250/500K exclusion.
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