Sold a bldg that was aquired as 1031 rollover. Both bldgs were owner occupied sometimes & fully rental other times. I dont see how to enter this info in turbo tax

[sfshore2]

I know how to calculate depreciation recapture and cap. gains  but it seems turbo tax only allows 1 building and doesnt allow for buildings where % that was business use varied

[sfshore2]

Following up on my own question.  Turbo Tax has me calculate the amount of the property that is land vs building and it SEEMS that turbo tax uses this to calculate capital gains. I don't think this correct.  When calculating depreciation recapture, yes, you need to distinguish between land and building but not for capital gains. But I don't see where turbo tax makes distinction.  It shows tax due on the sale, but where do I see how it calculated capital gain vs depreciation recapture?

[ReneeM7122]

To complete Form 8824, complete these steps:

1. First, enter the data for the 1031 Exchange.  This is done under FEDERAL TAXES... Wages & Income... Business Items... Sale of Business Property.  The first question is on "Any Other Property Sales?".  Check the box for like-kind exchanges.  Complete the questions in this section and TurboTax will:
   1. Generate form 8824 for your like-kind exchange
   2. Calculate the Deferred Gain.  This is presented after you answer the questions for the like-kind exchange.
   3. Calculate your New Property Basis.  This is presented after it presents the Deferred Gain.  Write down the New Property Basis as you will need it later.
       
2. Now, enter the data for the new rental property.  This is done under FEDERAL TAXES... Rental Properties and Royalties... Rental Properties and Royalties (Sch E).
   1. Under the Property Profile, indicate this is a New property (first year you rented the property).
   2. If the property was not rented all year, indicate the number of days it was rented.
   3. When asked "How did you acquire the property?", select "I acquired this rental through a like-kind exchange."
   4. You are presented with a help screen that basically tells you to go off and do step 1 above.
   5. Complete the Rental Income, Expenses, and Vehicle Expenses sections for the rental.
   6. Complete the Assets/Depreciation section.  Add an Asset for the Rental Real Estate Property.  When you get to the Cost, enter in the Cost Basis of the new property that was calculated back in Step 1 above (you wrote that number down).
   7. When asked More About This Rental Asset, enter the date you first started using the property as a business.  This date is used to pro-rate your depreciation for the current tax year.
       
3. Now, enter the data for the old rental property.  This is done under FEDERAL TAXES... Rental Properties and Royalties... Rental Properties and Royalties (Sch E).
   1. Under the Property Profile, you will get to a screen that asks "Do Any of These Situations Apply to This Property?"  Now here comes the tricky part!  You and your realtor may think you sold this property, but you did not - you exchanged it.  Do not check the sold box.   If you click "Learn More" it will tell you not to check the box if you did a like-kind exchange.  (You may want to check "None of the above".)
   2. If the property was not rented all year, indicate the number of days it was rented.  
   3. Complete the Rental Income, Expenses, and Vehicle Expenses sections for the rental.
   4. Complete the Assets/Depreciation section.  When you get to "Your Property Assets", you will need to edit each asset that is listed.
   5. For each asset listed, answer "Yes" to the question "Did you stop using this asset in 2020?"  You will be asked the date that you stop using the asset (i.e., sold it, that is exchanged it).  This date will be used to:
      • Pro-rate your depreciation for the current year 
      • Deduct all remaining refinancing charges (for refinancing assets)

Recap:

1. Enter the like-kind exchange information first to determine your cost basis for the new property.
2. Enter the new property information for the property you bought in the exchange.  Use the calculated cost basis from Step 1 and the date the property was put into service.
3. Enter the old property information.  Technically, the property was not sold, but exchanged.  Do not report it as being sold, but report the dates it was taken out of service.

Here is a TurboTax article about form 8824.

[sfshore2 · Accepted solution]

thanks for the information

It's a little confusing because when I look  at

"Any Other Property Sales?" -->   like-kind exchanges.  it asks if I did a like kind exchange in 2020 or 2018-19.

actually I did the exchange 20 years ago.  I understand turbo tax needs some way to calculate the basis when I  bought building two 20 years ago - I'll use this and say that the like-kind exchange took place this year.  Thanks

[sfshore2]

i followed your advice but now that it's time to file my taxes turbo tax won't accept what you told me to do and their support says they can't help me