TTax seems not to be processing FTB Form 3840 correctly

[DF-in-CA]

Some years ago we did a 1031 real estate exchange (a property in CA for a property in TX) and still own the TX property, and now I file an informational Form 3840 with CA FTB every year.

This year, TTax generated a blank Form 8824 and a blank Copy 1 Form 3840 linked to that 8824, but it does not list a 3840 for the Schedule E property.

I think the problem is that I answered Yes on the 'Like-Kind Exchange Reporting Requirement for California' page when asked if I wanted to complete the form. Although the instructions referenced the requirement to file an annual information return, I was not taken to my annual information return but instead to a new copy of the form.

How do I recover from this error and make sure I have the 3840 I am supposed to have?

I have deleted the blank Copy 1 of Form 3840 but not yet the incomplete 8824.

(Also, can you fix the information in the appropriate section to steer users correctly if they have not done a Like-Kind Exchange this year but merely want to make sure the continuing reporting requirement is being met?)

[MonikaK1]

To get to CA Form 3840 and include it with your 2023 return, go to the California state return interview. When you get to the screen, "Here's the income that California handles differently", scroll down to the section labeled Investments and select "Like-Kind Exchanges for Property Located Outside California", then Yes to complete the form.

Here's how to direct TurboTax to prepare an Annual form only:

For Question B, select the radio button for Annual FTB 3840 since this is not the year of the exchange.

All taxpayers, regardless of residence status or commercial domicile, who exchange real property located in California for like-kind property located outside of California, must file form FTB 3840 with their California tax return. TurboTax will prepare the form and include it with the California return.

Form FTB 3840 must be filed for the taxable year of the exchange and for each subsequent taxable year, generally until the California source deferred gain or loss is recognized on a California tax return. 

See here for California information and instructions for the completion of Form 3840.