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There's a lot of posting on this subject, so I hope you will be patient with me on this. I've gathered I'm going to need a professional but was hoping to get a few general answers to my questions here.

My wife and I, about 5-6 years ago bought a property in the Truckee area of Lake Tahoe. We bought it to build our retirement home on, but now realize the building costs of $300+ a square foot preclude us from building. We can't afford that.

The property has appreciated beyond our expectations and now I'm wondering if I can't use a 1031 Exchange to fund our actual retirement home. Sell the Tahoe lot and buy elsewhere (we're thinking Reno) with the proceeds from the Tahoe lot.

A real estate agent who would like to sell our lot (for obvious reasons) has said do an exchange. Buy a home in Reno with the proceeds and rent it out for a year, then we can move in and our proceeds will have been shielded from taxes.

So we will be selling a vacant lot for a new house. Does this fit under a 1031 Exchange? Is renting the new house for a year long enough? If the new house costs as much at the lot how much of the profit is shielded? Does the fact the lot was bought while we were residents of AR and now are residents of FL effect the transaction? Does an exchange usually shield the profits from State taxes? When does this meter start ticking on the year we have to rent out the property? When the Tahoe lot is sold or when we buy the new property? What if its difficult to rent out?

Well, that's more questions than I thought I had. I know I'm going to need a professional and the agent suggested one, but frankly, I'm assuming the only thing the agent is thinking is her commission so I'm reluctant just to accept her recommendation. How do I find this kind of professional.

johnny
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