HOW do i report a 1099s for a like kind exchange. and why do i show a capital gain when the new property cost more than the old one.

[2014kltaxes]

ANSWER PER WWW.IRS.GOV     INSTRUCTIONS FOR 1099S:

If you are reporting a like-kind exchange of property for which no gross proceeds are reportable, enter -0- (zero) in box 2 and enter an "X" in the checkbox in box 4.

Had to find the answer myself, and now about to try it!

[Crater lake]

how do I enter 1099s in form 8824?

[2014kltaxes]

Dear Crater Lake -  I have Turbo Tax premier - and as far as I can tell Turbo Tax does NOT have a form 1099-S.  Which I think is a joke.

To me - the IRS gets certain information against my social security #, for which they will run against my return to see if I enter that amount.   So for that I am not happy.

I did get a reply from some "tax expert" working for Turbo Tax who told me to just use the information from my 1099-S and enter it into the system.    Again, this does not decrease my chances of being selected for audit.

Another problem I found - was that when I did the disposition of the asset - Turbo Tax automatically created a gain, as there was no way to tell the system this was a 1031 exchange on the disposition.

I had to dispose of the asset (original property) at the date of sale - so that depreciation would calculate correctly, allocated for the year.        What I did, which is wrong, was to plug a number as sales costs which would force the net gain/loss of that disposition to be zero.   Which was to plug a large number to avoid gain on recapture of my prior year depreciation, and gain from sale at a price higher than book value or original cost, less year to date depreciation.

Another thing - was that the sales price on the 1099-S, was allocated the assets in the home I disposed of.  Again Turbo Tax did not take any partial depreciation of any asset I acquired in 2019.   I put over $25,000 of upgrades in the property prior to disposition, so I wanted to allocate that sales price on the 1099-S to the home value as well as other capital improvements I did to the home prior to sale.       Because my disposition of the home included assets purchased prior to 2019 and in 2019 - Turbo Tax did not "net" all my gains/losses on the disposition.   Instead, if I disposed of an asset for more than net asset value - it was charging me a capital gain.     Again, I had to keep plugging in a different disposition value on each asset related to the home to try to get as close to a zero net gain/loss on disposition.     I found Turbo Tax to be flawed in helping tax preparers who have this situation. 

For me - I didn't find Turbo Tax to have what I really needed it to have to do the disposition of the home and for me to enter the 1099-S properly.      I will be looking into a different tax package for next year, if anyone has any recommendations - please tell me.         The Turbo Tax expert who wrote to me just said "you have a complicated tax situation".      I don't - because other people have the same tax situation, and a 1031 exchange is allowed by IRS regulations.

I'm just trying to do my taxes correctly and avoid an audit.    I have nothing to hide - just not like how Turbo Tax can't properly address this situation, when I pay a higher price for the Premier Tax package.  I expected some programming to be done to address this allowable tax situation.

I haven't filed my return yet - so still hopeful someone has some proper way of handling this. 

[DianeC958]

To get to the like-kind exchange section in TurboTax:

1. Sign in to TurboTax and open or continue your return.
2. Search for like kind (2 words, no dash) and select the Jump to link in the search results.
3. On the Any Other Property Sales? screen, check the Any additional like-kind exchanges box and select Continue.
4. Answer Yes on the Like-Kind Exchanges screen and follow the instructions. We'll fill out Form 8824 for you.

[omartyne]

I did use 'Jump to' button, but there was no place to enter data from 1099-s. I was never able to find that link again. Ended up editing form 8824 manually using other documents from sale, purchase, and exchange intermediary. Instructions for 8824 are very unclear and do not ask for 1099-s. Will not file now, and appreciate any help.

[JohnW222]

Omartyne, please try the procedure at "Where do I enter Form 1099-S?" for entering your data.  

It's probably best to delete Form 8824 prior to trying this; please see "How do I view and delete forms in TurboTax Online?" or "How do I delete a tax form in the TurboTax CD/Download software?", as appropriate, for guidance.

[omartyne]

Deleting 8824 form did not help. I deleted it, then followed TurboTax navigation, but it never provided me with an option to add 1099-s, and depreciation for the new property is not calculated. Is there an expert in TurboTax to contact? Is there a fix to TurboTax? I reloaded all updates today, but again nothing helped. This really makes Turbo Tax unusable for rental properties

[2014kltaxes]

omartyne:   for the new (replacement) property you have to create the new property and add a minimum of two asset lines.  one is the carryforward basis,  (you enter the initial purchase date etc.  as this depreciates over the remaining life if any)   the 2nd is the additional basis which depreciates over its full life.     

[2014kltaxes]

omartyne:   I had the same problem.  There was no 1 specific line to enter the gross value on the 1099-S.   I am hoping IRS sees that I have a 1031 exchange.   As to the gross value of the sale - for me, I had to allocate the sales price against multiple assets... not just against the initial purchase price.     So my gross sales price was allocated to the disposition of ALL my detail asset worksheets under the one property.   Again - the problem I had was on the disposition of the primary property when the disposition value was GREATER than the purchase price, Turbo tax wanted to calculate a capital gain.    I just plugged any random number in the sales expense (additional to real disposition expenses, like 1031 exchange fee, closing costs, etc)   to make the capital gain value Turbo tax calculates to net to zero.    100% not correct.   But the whole purpose of the 1031 exchange is to push the capital gain down the road.     Again - not technically correct, but that was my work-around.   Hellow IRS.  I will explain it all if I get audited.    Not afraid of telling my truth later. 

[mdknguyen]

Hi - Has any figured out how to enter a 1099-S as part of a 8824 Like exchange?  I am able to enter the 8824 exchange but can't located where to enter 1099-S.  I was able to report a home sale but it assumes I'm selling it as my primary and not a rental for 1031 exchange and registers a big taxable gain.  Please help.

[ThomasM125]

You are not required to report a form 1099-S on your tax return unless you have a taxable gain. It is common for homeowners to receive that form and not report it, since most residential home sales do not result in a capital gain. 

[mdknguyen]

Thomas thanks.  I assume they will see the 8824 form and connect the dots?

[mdknguyen]

Thomas - I forgot I did get a 1099-S from the escrow company that sold the rental home.  1099-S should the proceeds in #2 which is the total money received.  #4 was checked.  I called them and they said the #4 checked box will let IRS know it was exchange.  Any help on this would be appreciated.  

[ThomasM125]

Since you are reporting an exchange, the necessary information would be on form 8824, so you wouldn't have to do anything further.