Avoid Paying Taxes on the Sale of Rental Property

#1 Don't sell. Keep the property "very long term". If you want money out of the property, borrow against the property's equity whenever the property appreciates. 

Income from a loan is not taxable. Let the rent pay the loan payments. The "Don't Sell" strategy works for assets like real estate or stocks. If you don't sell, no capital gains taxes are due. 

#2 Sell the property & do a 1031 Exchange. You must buy more real estate, but this might be your goal. 

Someday, your heirs may benefit * Discuss your options with a tax attorney.