What is Form 8824?
Form 8824, Like-Kind Exchange, is an IRS form used to report the exchange of business or investment property for similar property. This exchange, called a like-kind exchange, allows you to defer capital gains taxes. The form helps you calculate the amount of gain being deferred and keeps track of basis adjustments. It is particularly important for real estate investors and business owners who wish to sell one property and acquire another without facing immediate capital gains tax liabilities.
What is Form 8824 used for?
Form 8824 is essential for those involved in property exchanges. Here’s what it’s used for:
- Reporting Like-Kind Exchanges: To report exchanges of business or investment property for similar properties.
- Calculating Deferred Gains: To figure the amount of gain deferred as a result of a like-kind exchange.
- Tracking Basis Adjustments: To track the basis adjustments of the new property.
- Meeting Tax Requirements: To meet specific tax filing requirements, including reporting related party information and calculating the gain on the transaction.
How to fill out Form 8824?
- 1
Identify if the property exchange qualifies as a like-kind exchange under IRS Section 1031.
- 2
Complete Parts I, II, and III to report each exchange of business or investment real property.
- 3
Enter the date of written identification of the like-kind property received on line 5.
- 4
Calculate the amount of deferred gain and the basis of the like-kind property received.
- 5
File Form 8824 with your tax return for the year of the property transfer.
- 6
Meet deadlines: identify a replacement property within 45 days and complete the acquisition within 180 days.
Who is required to fill out Form 8824?
Form 8824 is typically filled out by individuals or entities involved in exchanging business or investment real property for similar properties. This includes property owners, real estate investors, and businesses engaged in such transactions.
After completing Form 8824, users report the exchange on their tax return, entering the information into other tax forms, such as Form 4797, to calculate and document the gain or loss from the exchange.
When is Form 8824 not required?
Form 8824 is not required when the exchange fails to meet IRS Section 1031 criteria, such as when properties are not like-kind or when the exchange doesn't involve business or investment properties. Additionally, if the exchange occurs with a related party without any exceptions, you may not need to file this form. Always verify specific circumstances to ensure compliance.
When is Form 8824 due?
The deadline for Form 8824 is April 15th of the following year, coinciding with your tax return due date. Additionally, it must be completed within 180 days of transferring the relinquished property. Make sure to keep these timelines in mind to avoid any complications with your tax filing.
How to get a blank Form 8824?
To get a blank Form 8824, Like-Kind Exchange, simply head to our website. The Internal Revenue Service (IRS) issues this form, and we have a pre-loaded version ready for you to fill out. Remember, our platform aids in filling and downloading, but not in filing forms.
Do you need to sign Form 8824?
No, you do not need to sign Form 8824, Like-Kind Exchange. This form is for reporting purposes and should be submitted with your tax return without a signature. For the best results, always check for the latest updates regarding tax forms. With PDF Guru, you can fill out the form, download it for your records, and take care of everything else that requires your attention.
Where to file Form 8824?
To submit Form 8824, you will need to mail it to the IRS. Ensure it is completed with all necessary attachments as per the current instructions.
Remember, Form 8824 cannot be filed online. Check the IRS instructions for the correct mailing address to send your paper return.
