Reinvesting profit from the sell of a rental house

[bk2eagle]

I just sold a rental property with a marginal profit. To avoid capital gains tax, do I have to invest in another rental property, or will a REIT suffice to avoid the capital gains taxes on the sell? If so, how long do I have to reinvest the profit? Thanks for your help in this matter.

[VolvoGirl]

It doesn't matter what you do with the sale proceeds it is a taxable sale.  Or did you do a 1031 exchange?

[Anonymous_]

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@bk2eagle wrote:

I just sold a rental property with a marginal profit. To avoid capital gains tax, do I have to invest in another rental property, or will a REIT suffice to avoid the capital gains taxes on the sell? If so, how long do I have to reinvest the profit? Thanks for your help in this matter.

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There is nothing you can do to avoid capital gains taxes (or unrecaptured Section 1250 gain) on the sale at this point. 

Once you are in actual or constructive receipt of the proceeds, it is far too late to do a 1031 exchange, so that option is no longer available.