Hello Diane,
Yes, the depletions have already been setup at 15% for the Oil and Gas property. TurboTax did that for me...very handy!
Can you please break this statement down a little further for me? "Although you cannot depreciate the amount assigned to the oil & gas property, you must assign a value to it as it was also a property received in the trade."
- Are you saying that the value of the Oil and Gas property ($250,000) still needs to be included in the "Fair Market Value of like-kind property received" in the "Sale of Business Property" section? If YES, I still have that populated.
- Or, are you implying that a portion of the original property's land ($62,000) still needs to be apportioned to the Oil and Gas property, even though I technically only own the minerals? Is this a must have step to connect it to the 1031 Exchange? Or is that done with #1 above?
- Even if #2 is YES, I would not apportion any of the "additional" basis to the oil and gas property? Is that correct? I believe that is what you said in your earlier email today.
Thanks so much!
Jamie
