First off, if you have been depreciating the Boston property for income tax purposes, your adjusted cost basis is considerably less than $300K. Has it been a rental since 1999 ?
IF YOU SELL; Your federal taxable profit will be the difference (Based on the adjusted cost) possibly 15% long term gains but you will probably owe the Commonwealth of MA income tax also, and may owe CA some too….
A 1031 exchange is possible to defer your tax liability but somewhat complicated if you have never done one.
You will need an accommodator and you cannot ever have control of the funds. They must go from escrow to the accommodator, never through your control.
You probably will need to have at least as much debt on the new property as you currently have in MA.
You will have an adjusted cost basis on the new property and once you move into it and it is no longer a rental you will probably incur tax liability, state and federal.
1031 rules are tough. Talk to an experienced tax advisor who is familiar with 1031 exchanges.
One mistake can cost you the entire tax liability rather than deferring it.
