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    indirasolano's Avatar
    indirasolano Posts: 2, Reputation: 1
    New Member
    		  
    #1

    Sep 22, 2006, 07:06 AM
    Capital gains from investment property
    According to the 1031 like-kind exchange you can't buy a property to make it your primary residence using the money from an investment property (rental home?) and then avoid to pay capital gains. Is this correct?

    Is it true that if I sell a house I had as an investment property, that I can buy another property, rent it out for a year, and then move in to this house and after two years living there I can sell it and I won't have to pay capital gains?

    I sold a house in Miami, FL but I live in GA, do I have to pay the 6% state tax on top oof the 15% I have to pay for capital gains?

    Thanks in advance!
    ScottGem's Avatar
    ScottGem Posts: 64,966, Reputation: 6056
    Computer Expert and Renaissance Man
    		  
    #2

    Sep 22, 2006, 07:10 AM
    This is a tax question, not real estate. I'm requesting it be moved to the correct forum
    indirasolano's Avatar
    indirasolano Posts: 2, Reputation: 1
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    #3

    Sep 22, 2006, 07:15 AM
    Quote Originally Posted by ScottGem
    This is a tax question, not real estate. I'm requesting it be moved to the correct forum

    Thanks!
    AtlantaTaxExpert's Avatar
    AtlantaTaxExpert Posts: 21,836, Reputation: 846
    Senior Tax Expert
    		  
    #4

    Sep 22, 2006, 04:43 PM
    It is true that you cannot move directly into an investment property that you bought using a 1031 like-kind exchange. It needs to remain a business property for at least a year. After that, you should be able to move in and, after living it in for several year (I'd say five to be save), you should be able to sell it and qualify for the tax exemption.
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