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My tax preparer says that I can do a 1031 exchange on a property which sells for $500k into a property selling for $550k and take cash out of escrow equal to the tax loss carry forward on the old property. Clearly the mortgage would increase, but this is OK with me.

Is this correct?

In some ways it makes sense, but in some ways it sounds an awful lot like "boot" which would be taxable.

Does anyone know for sure?
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