Can you sell mineral rights, and avoid the tax burdon by buying a home.? How does this work. Or is it even doable. Thanks
You would need to get professionals to assist you.
This is an excerpt from the IRS FACT SHEET “Like-Kind Exchanges Under IRC Section 1031 FS-2008-18, February 2008”:
"What property qualifies for a Like-Kind Exchange?
Both the relinquished property you sell and the replacement property you buy must meet certain requirements.
Both properties must be held for use in a trade or business or for investment. Property used primarily for personal use, like a primary residence or a second home or vacation home, does not qualify for like-kind exchange treatment.
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Not advice, but experience with 1031s. You can sell the minerals, have the funds deposited with a certified 3rd party holding company. Then use those funds to purchase a “second home”, not a primary residence. It must be a “like kind” investment and minerals and primary residences are not considered “like kind”. You can look up companies that handle 1031 Exchanges and they can help you define what you can do. Midland Trust is a good one.
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