Here’s a common 1031 exchange question we get from time to time – how much personal use can you take on a replacement property put into a rental pool? In other words, if a taxpayer sells a Minnesota rental property in Minnesota and buys a rental condo in Florida, how much can they live in that Florida “investment” property without violating tax laws?
Rental Pool Property Rules
If the taxpayer puts the Florida property in a rental pool, they can have some limited mixed personal use: up to 14 days a year, or up to 10% of the time it is actually rented in a year. The IRS can test each of the two separate years after the exchange under the safe harbor.
Contact a Qualified Intermediary
It’s always a good idea to contact a skilled qualified intermediary if you have questions about any details surrounding your 1031 exchange. Contact the intermediaries at CPEC1031, LLC today to discuss your exchange!
Start Your 1031 Exchange: If you have questions about 1031 exchanges, feel free to call me at 612-643-1031.
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