Can I make a 1031 exchange with my primary residence?

You cannot make a 1031 exchange with your primary residence. The tax rules are designed specifically for investment properties only. If you do make an exchange with your primary residence, you would have to pay taxes on the capital gains for the tax year when your home was sold. You can only defer the taxes under 1031 rules if your find an investment property, which can include vacant land.

Publication 544 published by the Internal Revenue Service is an excellent resource for the rules regarding a 1031 exchange, primary residence exceptions and more.

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