IRS 8824 2017 free printable template

B c You can establish to the satisfaction of the IRS that neither the exchange nor the disposition had tax avoidance as one of its principal purposes. If this box is checked attach an explanation. See instructions. For Paperwork Reduction Act Notice see the instructions. Cat. No. 12311A Form 8824 2017 Page 2 Your social security number Realized Gain or Loss Recognized Gain and Basis of Like-Kind Property Received Caution If you transferred and received a more than one group of like-kind...

How to fill out IRS 8824

How to fill out IRS 8824

1. Obtain IRS Form 8824 from the IRS website or your tax software.
2. Fill out Part I by providing your name, address, and social security number.
3. Complete the sections that detail the like-kind exchange, including the description of the property you are exchanging and the property you are receiving.
4. Fill in the date of the exchange and the fair market value of the properties involved.
5. Indicate any liabilities assumed or relief from liabilities in the transaction.
6. Calculate the gain or loss associated with the exchange and provide the necessary information in Part II.
7. Review your information for accuracy and completeness before submitting it with your tax return.

Who needs IRS 8824?

1. Individuals or businesses that have engaged in a like-kind exchange of property for tax purposes.
2. Taxpayers seeking to defer gains on the sale of business or investment property.
3. Those who have exchanged real estate or other qualifying property.

People Also Ask about

How is depreciation handled in a 1031 exchange?

Types of Depreciation in a 1031 Exchange The adjusted cost basis for the property you sell must be divided by 24.5 years. This rate is your first schedule of depreciation. The remaining cost basis of your replacement property must be divided by 27.5 years — the second schedule.

How do you depreciate property received in a like-kind exchange?

There are two ways to depreciate real estate post 1031 Exchange. Post-1031 exchanges the tax code states that you must split depreciation into two separate schedules as the preferred method. However, investors can opt-out of two schedule depreciation and depreciate the calculated cost basis on a single schedule.

What is the timeline for a 1031 exchange?

Every 1031 exchange is reported to the IRS and must adhere to a specified timeline. The process involves two key deadlines: the first is identifying a new property in written form within 45 days, and the second is obtaining the replacement property within 180 days.

What is the basis of like kind property received?

In the simplest situation, where only like-kind property is exchanged and the taxpayer does not recognize any gain or loss, the basis in the surrendered property carries over to the acquired property. Thus, the basis of the property acquired equals the adjusted basis of the property that was given up.

What is a like kind exchange for depreciation?

Share: A “like-kind exchange,” or “Section 1031 exchange,” allows real estate investors that incur gains on real property sales to reinvest those proceeds and defer the gain—offering an advantageous tax planning strategy for real estate companies.

What is an example of a like-kind exchange depreciation?

For example, a taxpayer sells a commercial building for $500,000 with an adjusted tax basis after depreciation of $150,000. The taxpayer decides to complete a like-kind exchange for this sale. In the like-kind exchange, the taxpayer acquires another commercial building for $550,000, investing an extra $50,000.

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What is IRS 8824?

IRS Form 8824 is used to report Like-Kind Exchanges under Internal Revenue Code Section 1031. This form is necessary when a taxpayer exchanges one property for another property of a similar type.

Who is required to file IRS 8824?

Any taxpayer who engages in a Like-Kind Exchange of real or personal property must file IRS Form 8824 to report the exchange.

How to fill out IRS 8824?

To fill out IRS Form 8824, you need to provide details about the properties exchanged, their fair market values, the dates of the exchanges, and any received or given cash or property.

What is the purpose of IRS 8824?

The purpose of IRS Form 8824 is to report the details of Like-Kind Exchanges that allow taxpayers to defer paying capital gains taxes on the exchange of similar properties.

What information must be reported on IRS 8824?

IRS Form 8824 requires reporting information such as the description of the properties exchanged, the dates of the exchange, the fair market values, and any boot or cash received during the exchange.