Form 8824 -- Summary Smart Worksheet

roxx13

I need help reconciling the amounts received versus paid out on the Summary Smart Worksheet on Form 8824.

Client sold home for $1m but after expenses only netted $974,918. In order to complete the 1031 exchange, she put up $28,500 in cash.

The received property was $1.425m (Line A). After crediting the $974,918 and the cash, she assumed a $455,000 mortgage (Line B).

The worksheet is calculating $970,000 in equity received ($1.425m-455k loan) in Line C. As a result, the adjusted basis (Line 18) is showing a $1m additional cost basis.

In order to correct the adjusted basis, I have to show the $1m FMV in Line G of the Smart Worksheet (which is correct). BUT now it's forcing me to list a cash received amount in Line L. She didn't receive any money instead she gave cash (Line M).

HELP!

IntuitAmyC2

I tried making a 1031 to match your question. I added line K exchange expenses of $25,082 based on your $1M -$974,918. I am not being asked for line 15 cash given due to the line K entry.

I have a couple of thoughts on the $4918:

When I did a 1031, I had to pay the intermediary a fee. That amount is added to the exchange expenses on line k.
The $974,918 net proceeds vs the $970,000 from 1.425 price -455 loan is the cash/equity. If the closer sent $974,918 to the intermediary, that was an overpayment which becomes surplus and probably later refunded to be boot.

roxx13

@IntuitAmyC2 Are you available to discuss?

IntuitCatinaT

Please feel free to post your questions right here in the thread. That way, the whole community can benefit from the answer, and someone might even have an extra tip to add.