So I did go look a the beginning of SCH E like you suggested and I had checked the "I sold or disposed of this property" box. However, when reading the Learn More link, it says not to check this box if you are doing an exchange! Pretty funny as an exchange does involve selling the property so this description is far from intuitive.
However, unchecking the box did not seem to help. When I later go to the asset summary to enter the disposed of date for this property, whether or not I specify special handling, a taxable sale is generated. The question remains, how do I dispose of a rental property without having a taxable sale generated?
