Mom gifting rental property that we live in

[Kayre]

Mom bought a rental property in the 90s that she has been depreciating. We moved in 6 years ago and have paid rent the whole time we’ve lived there. We need a bigger house and she wants to be done with the one we live in. She was considering gifting the house to us, but would we have to live there an additional 2 years to get the credit toward capital gains? Or would it make more sense for her to do a 1031 exchange and then gift it to us since we’ll live in the new house for more than 5 years? Any thoughts? 

[smarttees]

No great way to get out of this....if she gifts you the house you have to live there for at least 2 years and you get her low low basis when you sell....she do a 1031 and then gift you the replacement house for you to use as a main home but you'll take her basis anyway.....no great way to solve this