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hriahei
New Member

I SOLD RENTAL PROPERTY 1031 EXCHANGE AND BOUGHT ANOTHER RENTAL PROPERTY I AM USING TURBO TAX TOFILE MY TAXES IDO NOT KNOWHOW TO REPORT WITH TURBO TAX

Isold my rental property which I bought 1998 for 279000 and sold for 1047000.00 in 2021 and bought like kind apt for 815000 by tax rules of 1031 exchange I using turbo tax Ido not know how to report it
3 Replies
Critter-3
Level 15

I SOLD RENTAL PROPERTY 1031 EXCHANGE AND BOUGHT ANOTHER RENTAL PROPERTY I AM USING TURBO TAX TOFILE MY TAXES IDO NOT KNOWHOW TO REPORT WITH TURBO TAX

You may want to upgrade to one of the LIVE options to get the help you need to complete the sections of the return you cannot figure out.  

 

You depreciate property you received in a like kind exchange (Section 1031), as though you never gave up the original property.  You use the same adjusted basis as the property given up. If you paid money in addition to the property given up then you would depreciate the additional cost over the same recovery period.

 

To be clear, you continue the depreciation as though there was no trade. Then with any extra cash that was paid for the replacement property (the property received in the exchange) you set up a new asset and begin depreciation in 2020 as residential rental property using 27.5 year recovery period (depreciation method).

 

If you buy up in your exchange (your New Property cost more than you sold your Old for), the answer is easy – you treat the additional cash part as you would a new addition to an existing property. In other words, you treat the amount of the buy-up the same as you would the cost of a capital improvement.

 

DoninGA
Level 15

I SOLD RENTAL PROPERTY 1031 EXCHANGE AND BOUGHT ANOTHER RENTAL PROPERTY I AM USING TURBO TAX TOFILE MY TAXES IDO NOT KNOWHOW TO REPORT WITH TURBO TAX

See this TurboTax support FAQ for reporting a Like Kind Exchange - https://ttlc.intuit.com/turbotax-support/en-us/help-article/import-export-data-files/enter-like-kind...

Mike9241
Level 15

I SOLD RENTAL PROPERTY 1031 EXCHANGE AND BOUGHT ANOTHER RENTAL PROPERTY I AM USING TURBO TAX TOFILE MY TAXES IDO NOT KNOWHOW TO REPORT WITH TURBO TAX

use live or seek the help of a tax pro. it would seem you traded down, (received boot) so some of your gain will be taxable. 

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