You will enter your half of all income and expenses. You should only report what belongs to you.
- Enter the like-kind exchange information first to determine your cost basis for the new property. This is under Sale of Business Property (not Sch E).
- Enter the new property information for the property you bought in the exchange. (Sch E) Use the calculated cost basis from Step 1 and the date the property was put into service.
- Enter the old property information. Technically, the property was not sold, but exchanged. Do not report it as being sold, but report the dates it was taken out of service.
Related: Like-Kind Exchanges - Real Estate Tax Tips | Internal Revenue Service.
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