1031 Exchange expenses

Forum|Forum|3 years ago
December 27, 2022
1 reply
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In stepping through a like kind exchange I come to a screen where TurboTax is asking for any sales expenses, which includes:

Sales expenses include the following:
- Sales commissions
- Advertising expenses
- Legal fees
- Loan charges paid by the seller, such as loan placement fees or points
- Broker fees
- Transfer taxes
- Option premiums

This in turn populates line K (Exchange expenses total) of the smart worksheet for line 15 of Form 8824. Unfortunately what is requested are only the expenses associated with the relinquished property, not the qualified intermediary fee and costs associated with the purchase of the replacement properties. Where are these costs entered?

Best answer by Anonymous_

In the interview for "Exchange expenses".

Any other expenses will have to be entered in Forms Mode on Form 8824 (which may require an override voiding the accuracy guarantee and most likely preventing the return from being e-filed).

Anonymous_

Level 15

See https://www.irs.gov/instructions/i8824#en_US_2022_publink12597kd0e518

Line 15 and Line 18

kashblack1953Author

Level 4

Thanks! I have read the IRS instructions. My question is where in TurboTax are these expenses entered?

Mike9241

Level 15

What was the work around that gave you the correct answers two years ago? Can you just increase the FMV of the replacement property to include the associated exchange costs? Or do you have to manually edit line 18 of form 8824 to include the costs?

go to business items sale of business property when you go through the 8824 (for 1031 exchange) it should ask you about exchange expenses.

as I went through finally there was a page that said "Exchnge expenses" and asked for an amount