How much personal use, and business use (for repairing and maintaining) is allowed after 1031 exchanging into a rental pool replacement property?
Maintaining vs. Improving
Any day that you spend working substantially full-time repairing and maintaining (not improving) your property is NOT counted as a day of personal use. Do not count such a day as a day of personal use even if family members use the property for recreational purposes on the same day.
Here are some additional resources on this topic:
- First, check out this article on how much you can use the Replacement Property for personal use, if it is put into a rental pool.
- Internal Revenue Bulletin: 2008-10
- Finally, please take a look at IRS Publication 527 for examples of time you are staying at the Replacement Property for business purposes.
Be sure to talk with your CPA or tax accountant about your specific situation.
- 1031 Hotline: If you have questions about personal use when it comes to replacement property, feel free to call me at 612-643-1031.
Defer the tax. Maximize your gain.
© 2017 Copyright Jeffrey R. Peterson All Rights Reserved