Like Kind Exchange - Boot

Collapse
X
 
  • Time
  • Show
Clear All
new posts
  • peggysioux
    Senior Member
    • Sep 2006
    • 666

    #1

    Like Kind Exchange - Boot

    On a LKE is the portion of boot (cash of $70,513) taxpayer received or the recognized gain amount added to basis?

    I know that normally basis of new property consists of adjusted basis of old property plus exchange expenses plus difference between FMV of new property vs. old property; but was unsure how or if the "boot" portion came into play as far as basis for depreciation in future years. Any direction would be greatly appreciated!!
  • jainen
    Banned
    • Jul 2005
    • 2215

    #2
    You are correct

    >>normally basis of new property consists of.... "

    You are correct about determining the new basis that way, but there is an alternate method you can use to check it. Take the FMV of the new property, minus the deferred gain. Boot received shows up inside the calculation of deferred gain.

    Comment

    • peggysioux
      Senior Member
      • Sep 2006
      • 666

      #3
      Boot

      So as long as I am depreciating the adjusted basis of the original basis (carryover basis of original property) plus add the LKE - expense of exchange, plus the excess basis (FMV of acquired property over FMV of exchanged property), then I have everything covered and the boot is basically already included in the deferred gain. Does it sound like I have correct??

      Thanks!!!!!

      Comment

      • jainen
        Banned
        • Jul 2005
        • 2215

        #4
        You got it right

        >>the boot is basically already included in the deferred gain<<

        Well, technically the boot is EXcluded from the deferred gain, but I know what you mean! You got it right.

        Comment

        • peggysioux
          Senior Member
          • Sep 2006
          • 666

          #5
          Boot

          Thanks Jainen!!!

          Comment

          Working...