Welcome back! Ask questions, get answers, and join our large community of tax professionals.
cancel
Showing results for 
Search instead for 
Did you mean: 

In like-kind exchange, should I use ONLY "Depreciation" and "form 8824 " in Deductions, or do I ALSO need to use the "Schedule D", "4797 form" and "form 8824" in Income?

ckeller
Level 1

Please, is there anyone who could help me on this tax return for a client. First time using PTO and I'm having a hard time for the past week. When client has a 1031 exchange property from CA selling it in 2018 which had a depreciation of the land, and a replacement property in the same year in NY.
Should I use ONLY "Depreciation" and "Like-Kind exchange 8824 form" in Deductions, or do I ALSO need to use the "Schedule D", "4797 form" and "Like-Kind exchange 8824 form" in Income?

Also, do I need to file the form CA 3840 final as well? TIA

0 Cheers

This discussion has been locked. No new contributions can be made. You may start a new discussion here

1 Solution

Accepted Solutions
George4Tacks
Level 15

If you have depreciation, this is likely the article to get you started. https://accountants-community.intuit.com/articles/1628244-how-do-i-enter-a-like-kind-exchange-in-the... 

Yes, you do need to file the 3840 for 2018 and every year thereafter until the exchange property is sold. 


Here's wishing you many Happy Returns

View solution in original post

0 Cheers
6 Comments 6
George4Tacks
Level 15

If you have depreciation, this is likely the article to get you started. https://accountants-community.intuit.com/articles/1628244-how-do-i-enter-a-like-kind-exchange-in-the... 

Yes, you do need to file the 3840 for 2018 and every year thereafter until the exchange property is sold. 


Here's wishing you many Happy Returns
0 Cheers
ckeller
Level 1
In this case the exchange property was sold the same year, do I need to file the CA 3840 as Final? Thank you!
0 Cheers
George4Tacks
Level 15
Yes. Reporting the taxable gain as CA income.

Here's wishing you many Happy Returns
0 Cheers
abctax55
Level 15

"...which had a depreciation of the land".

Land is not depreciated.  Are there also improvements involved?

"*******Tax software is no substitute for a professional tax preparer*******
( Generic Comment )"
0 Cheers
TaxGuyBill
Level 15
That was my original thought too, but I *THINK* the situation is that the prior property had depreciation, then a 1031 exchange was done for land.  So selling the land would still result in §1250 gain from the depreciation of the prior property.
0 Cheers
ckeller
Level 1
Sorry guys, that was mistake from my part, I meant depreciation of the building, not land. On the 2017 depreciation, there was a cost basis showing in the box titled as Land, that's what confused me.
0 Cheers