We did a 1031 exchange using a qualified intermediary, where we exchanged one rental property for 3 replacement rental properties. I understand the depreciated basis of the property we gave up, the costs involved in the transaction and how to allocate the basis plus costs involved in the transaction plus the cash we had to put in to the transaction to the replacement properties, but am unclear how to enter this into Turbotax Home & Business.
For the FMV of the property we gave up I entered the sales price
For the FMV of the replacement properties I entered the total purchase price
Continuing on, I get a screen titled "different property received", where it asks for:
Fair market value of other property received (I entered zero, there wasn't any)
Promissory or installment note received (I entered zero, there wasn't one)
Cash received (I entered zero, as we didn't receive any other cash)
I then get a warning stating that these items must add up to $26,500 and the program won't advance beyond this screen. Now, the sales price of the property given up is $26,500 greater than the negotiated prices of the replacement properties, however this ignores the sales commission & closing costs of the property we gave up. We received zero cash out of this transaction, in fact we had to put cash into the deal. Should I be using the cash we received from the property we gave up as it's FMV and the buying price plus closing costs for the replacement properties FMV?
Per usual, TurboTax seems to give zero relevant help here. Related question, I have lumped the three replacement properties into a single 1031 transaction, is that ok? I have yet to encounter where I set the basis for each replacement property.
