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State tax filing
Are you thinking of a partial capital gain exclusion? Scroll down to "Does Your Home Qualify for a Partial Exclusion of Gain?" in this IRS reference for the rules:
https://www.irs.gov/publications/p523#en_US_2022_publink100073096
This commercial website (with which I have zero affiliation) discusses different scenarios for combining a capital gain exclusion with a 1031 exchange:
https://www.exeterco.com/article_overview_1031_121_combination
My advice: consult a local real estate tax attorney.
**Answers are correct to the best of my ability but do not constitute tax or legal advice.
May 19, 2023
3:16 PM