1031 Exchange: Like-Kind Property Given Up > Adjusted Basis

[pixelrogue1]

1031 Exchange: Like-Kind Property Given Up > Adjusted Basis

This field appears be a field to enter a number. Given everything on the property sold has been tracked in TurboTax all along, would this information not be transferred? It seems as if TT is asking me to dig through years of paperwork to manually calculate? 

[Anonymous_]

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@pixelrogue1 wrote:

Given everything on the property sold has been tracked in TurboTax all along, would this information not be transferred?

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Unfortunately, as you have apparently discovered, the 1031 (like-kind) module does not work that way.

[pixelrogue1]

Thought one of the MAIN benefits to sticking w/TT all these years was for this information to carry through year-to-year, it will know these numbers and pre-populate (presuming the data was entered correctly.)

So then TT is asking me to dig up all the receipts for improvements for all the years to add them up to enter into that field, for real? That can't be right....something missing here. 

[Anonymous_]

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@pixelrogue1 wrote:

Thought one of the MAIN benefits to sticking w/TT all these years was for this information to carry through year-to-year.

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The program does not carry through all information from year to year (virtually no consumer-level tax preparation programs do so). 

The program will carry all of the improvements you enter (as depreciable assets) forward but you need to total those figures manually.

[pixelrogue1]

Then, to confirm, I need to dig through all the years to calculate improvements and enter that grand total into that field? Even w/the time-saving functions for the bookkeeping software,  reports and the like, this will take considerable time and effort to create. 

[pixelrogue1]

This sound like good news (better news than tearing through years of disparate data.)
From where, then, would those totals be manually calculated (from w/in TT (or previous tax returns))?

[Anonymous_]

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@pixelrogue1 wrote:

Then, to confirm, I need to dig through all the years to calculate improvements and enter that grand total into that field? 

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Yes, unfortunately that is the case. Further, since this is a rental, you need to factor depreciation deductions taken (allowed or allowable).

Quite frankly, this is pretty much what professional income tax preparers have to do for clients with a 1031 exchange.

[pixelrogue1]

TT would have kept track of the depreciation deductions throughout, right (a key component to the software)?
In theory, all the improvements would be somewhere in the tax file, but requires me locate and calculate.
In theory, all the deprecation would also be somewhere in the fax file, but requires me to locate and calculate. 

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FWIW ~ I do have a tax professional who reviews the return prior to official submission, and I look to get everything as buttoned up and clean as possible before it would be reviewed. 

[AmeliesUncle]

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@pixelrogue1 wrote:

Then, to confirm, I need to dig through all the years 

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No.  After going through all of the "assets" to indicate it was sold (and enter a sales date to stop the depreciation), you can print out the "Depreciation and Amortization Report" worksheet (it is the sideways looking spreadsheet).  In most cases, that has all of the information you need.

[Anonymous_ · Accepted solution]

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@pixelrogue1 wrote:

TT would have kept track of the depreciation deductions throughout, right (a key component to the software)?

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Yes, the program certainly does keep track provided you entered the improvements (as assets) in the software for the year in which they were made (placed-in-service). 

[pixelrogue1]

Had the building so long that it turns out most of the assets are already depreciated out to zero. Little-to-nothing left beyond the building itself. If they have already depreciated, presume there is no need to go in to each asset and mark a removed-from-service date ~ as the way of indicating sold.

[candycanepanda]

Thank you @AmeliesUncle  I was able to quickly find what I needed here to total everything and not dig through "years of turbo tax documents"