Get the free Form 8824 - irs

This form is used by taxpayers to report like-kind exchanges of property and nonrecognition of gain from conflict-of-interest sales, attaching it to their tax returns and providing necessary details

How to fill out form 8824 - irs

How to fill out Form 8824

1. Obtain a copy of Form 8824 from the IRS website.
2. Fill out the taxpayer's information at the top of the form, including name, address, and Social Security number.
3. Provide details about the property you are exchanging in Part I, including the description, date of acquisition, and fair market value.
4. Complete Part II by entering information about the property you are receiving, including its description, date of acquisition, and fair market value.
5. Fill out Section A or B in Part III to indicate the type of exchange (like-kind exchange or involuntary conversion).
6. Calculate any realized gain or loss from the exchange in Part IV and enter the amount.
7. Sign and date the form, and make a copy for your records before submitting it to the IRS with your tax return.

Who needs Form 8824?

1. Taxpayers who have engaged in a like-kind exchange of real estate or other qualifying property.
2. Individuals or businesses looking to defer capital gains taxes through §1031 exchanges.
3. Anyone who is reporting exchanges of property held for productive use in a trade or business or for investment purposes.

People Also Ask about

Do I need to report a 1031 exchange on my tax return?

After completing a 1031 exchange, you must report the transaction to the IRS using Form 8824 to maintain the transaction's tax-deferred status. You must file the form with your annual income tax return for the year in which the exchange was completed.

Which of the following does not qualify for a tax-deferred exchange?

Under IRC §1031, the following properties do not qualify for tax-deferred exchange treatment: Stock in trade or other property held primarily for sale (i.e. property held by a developer, “flipper” or other dealer) Securities or other evidences of indebtedness or interest. Stocks, bonds, or notes.

What qualifies for a tax-free exchange?

The main requirements for a 1031 exchange are: (1) must purchase another “like-kind” investment property; (2) replacement property must be of equal or greater value; (3) must invest all of the proceeds from the sale (cannot receive any “boot”); (4) must be the same title holder and taxpayer; (5) must identify new

What must be in the United States in order for an exchange to qualify for tax deferral?

The exchanged properties must be in the United States to qualify. There are strict time limits: The replacement property must be identified within 45 days, and the exchange must be completed within 180 days. Cash or mortgage differences, called “boot,” can trigger tax liabilities.

What is required on a form 8824?

Include your name and identifying number at the top of each page of the statement. On the summary Form 8824, enter only your name and identifying number, “Summary” on line 1, the total recognized gain from all exchanges on line 23, and the total basis of all like-kind property received on line 25.

How do you qualify for a tax deferred exchange?

You must acquire one or more replacement properties that are equal to or greater in net purchase value than the net sales value of the relinquished property you sold. You must reinvest all of your net cash proceeds from the sale of the relinquished property.

What happens if you don't file form 8824?

What happens if I do not file Form 8824? There are no penalties for failure to file Form 8824 but there are consequences. For starters, you can't defer capital gains tax. This means that the exchange may be treated as a sale transaction subject to capital gains tax.

Who cannot do a 1031 exchange?

You cannot trade partnership shares, notes, stocks, bonds, certificates of trust or other such items. You cannot trade investment property for a personal residence, property in a foreign country or “stock in trade.” Houses built by a developer and offered for sale are stock in trade.

For pdfFiller’s FAQs

What is Form 8824?

Form 8824 is used to report like-kind exchanges of real estate and personal property under Internal Revenue Code Section 1031.

Who is required to file Form 8824?

Taxpayers who engage in a like-kind exchange of property must file Form 8824 to report the transaction.

How to fill out Form 8824?

To fill out Form 8824, you need to provide information about the properties exchanged, the dates of the exchange, any gain or loss realized, and the details of any boot received.

What is the purpose of Form 8824?

The purpose of Form 8824 is to report the details of like-kind exchanges and to calculate any gain or loss associated with the exchange.

What information must be reported on Form 8824?

Form 8824 requires reporting of the description of the properties, dates of acquisition and exchange, the fair market value of the properties, and any boot received.