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Netting boot on Form 8824 ?

Technical topics regarding tax preparation.
#1
Posts:
399
Joined:
30-May-2014 7:38am
Location:
USA
Anyone willing to check my figures on an 8824?

Relinquished Property
FMV = $715,000
Adj basis = $330,000
Closing fees = $45,000
Realized gain = $340,000
Unpaid prorated R/E taxes on relinquished = $200

Replacement Property
FMV = $635,000
Closing fees = $10,000
Unpaid prorated R/E taxes on replacement = $1,200
Cash paid (EMD) for replacement = $4,000

Cash received from QI at end = $30,000

Form 8824
Line 15 = $26,000 ($30,000 - $4,000)
Line 16 = $645,000 ($635,000 + $10,000)
Line 17 = $671,000
Line 18 = 331,000 ($330,000 - $200 + $1,200)
Line 19 = $340,000
Line 23 = $26,000
Line 24 = $314,000
Line 25 = $331,000

Lacerte gives me a different result when I enter cash received ($30K) and cash given ($4K) in its separate input boxes. This has me questioning but I believe the cash should be netted and that my figures above are correct.
 

#2
Wiles  
Posts:
3002
Joined:
21-Apr-2014 9:42am
Location:
Bay Area - CA
I am getting:
Line 15 = $25,000 ($200 boot out on sale + $24,800 net boot out on purchase)
Line 16 = $635,000
Line 17 = $660,000
Line 18 = $330,000
Line 19 = $330,000
Line 23 = $25,000
Line 24 = $305,000
Line 25 = $330,000
 

#3
Posts:
399
Joined:
30-May-2014 7:38am
Location:
USA
I like your result better but doesn’t the net debt assumed (i.e., unpaid real estate taxes) belong on line 18 instead of 15?
 

#4
Wiles  
Posts:
3002
Joined:
21-Apr-2014 9:42am
Location:
Bay Area - CA
I consider the payment of real estate taxes as cash boot activity and not debt. This is what I do for all accrued/prorated operating income/expenses of the properties.
 


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