Selling part of acerage in Texas

QUESTION:   I have a property in texas that is a house with 260 acres of land that was my primary residence for over 2 years. The entire property isunder contract of sale to a person, to be closed by 12/31/07. However this person is asking to pay/buy part of the land now because he is doing a 1031 exchange and then buy the rest before the end of the year. If I agree to sell part of it now, am I subject the CGT on the land piece being sold before the house sale ? or is it ok if it is in the same tax year and to the same person???
david ingram replies: 

I sent your question off to Gary Gauvin ( an enrolled agent (and ex-partner of mine in Ottawa, Canada) who practices just outside of Dallas.  His reply follows.  Of course, if you need professional help with this, you should get hold of Gary at [email protected]

Gary Gauvin wrote:
As long as the land is attached to, or surrounding the house, was used as
part of the principal residence, and is sold within 2 years before, or
after, the sale of the house, you get one exclusion. So multiple sales can
qualify for the one exemption limit of $250,000 (500,000 MFJ)

An issue is frequently how much vacant land counts. In "Bennet" an
additional 65 acres (that was not used in a business) was allowed as exempt.
Also in "Schilcher" a whole 51 acres was allowed when 7.5 acres was used for
a horse breeding business. The court note that "residential purpose" may
include appreciating nature, living in open spaces, horseback riding and
enjoying unobstructed views of the countryside.
Thanks Gary