We always told investors and their advisors that while section 1031 did not define what qualified as an investment property, section 280A does. Taxpayers were not permitted to use the property for personal use more than 14 days of the year or 10% the number of days rented, whichever is greater. I am sure many vacation home owners didn't like our response to this question and found another qualified intermediary who would facilitate the exchange anyway. Some taxpayers converted a vacation home into a rental for one "season" and the more cautious waited even one year and then completed an exchange.
Thursday, March 27, 2008
1031 exchange and vacation homes - there's news!
1031 Corp. is reporting that the IRS has published new guidelines. Here's a blurb: