Subject: Exchange QuestionDear Tax Guru:One of my clients did a 1031 exchange during 2005, and I want to make sure I'm handling the accounting for the transaction correctly. There was a cash boot paid for the new property. I would like to know the specifics of the needed entry for book and tax purposes. Any guidance you can provide would be greatly appreciated.Sincerely,
You generally want the books to match the 8824 for the exchange. If your tax prep program doesn't produce detailed worksheet for exchanges, as Lacerte just started doing a few years ago, you can use a manual or computerized worksheet.
CFS's TaxTools program has some excellent 1031 exchange worksheets that I often use to double-check the Lacerte 8824.
Several years ago, I posted a manual worksheet on TFEC's website that is also very useful.
Good luck. I hope this helps.