Sure looks like a bug to me. How do we get TurboTax to investigate and fix? There may be multiple problems, but one thing is that for the sale property, you enter the FMV and the loan payoff. TT appears to assume that the difference between the two was cash out to invest in the exchange. So a FMV of 300K with a loan payoff of 100K means 200K cash out. When you enter the purchase FMV (larger than the earlier FMV) and loan assumed, if that difference is less than 200K, then TT assumes there must have been cash received. If you can get past the screen with the bug, THEN it asks for sales expenses. Ummm, my cash in hand was reduced by the sale expenses, so I didn't get 200K out to invest in the exchange property. Sale expenses should have been considered when determining the cash available to invest in the exchange.
