DEAR BOB: I am considering selling a rental house I own. My plan is to invest the sales proceeds into another rental house I own to improve it, also paying down the mortgage balance. Will this qualify as a tax-deferred exchange? It seems to comply with the "spirit of the law" – Doug W. DEAR DOUG: Because you already own the rental property you want to improve and pay down its mortgage balance, it cannot qualify for an Internal Revenue Code 1031 tax-deferred exchange. Forget about your "spirit of the law" silly idea. IRS revenue agents don't think like that. Purchase Bob Bruss reports online. IRC 1031 requires you to acquire a qualifying "like kind" rental or investment property of equal or greater market value without receiving any taxable "boot," such as cash or net mortgage relief. For more details, please consult your tax adviser. HOW MANY IS TOO MANY CONDO RENTALS? DEAR BOB: Some time ago you gave a formula for calculating the maximum number of rentals in a condo complex...
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