Hi, it's been years since I've done a like-kind exchange, so my memory is a bit foggy.

My client has a 190 acre ranch with two homes and a barn. Their operation is wildlife management, and they also reside in a home on the property. They sold the property in exchange for a smaller ranch (18 acres with 1 home and a barn). New property was purchased for 885k, prior property was sold for 1.4mil. The original property was inherited years ago, and had 1 small home. The client later built a new home and a new barn. I'm trying to determine what all I can deduct from the property given up.

My confusion lies in the fact that their home is included in this transaction, so when calculating basis, I would include property value at time of inheritance, cost of major improvements, ie: home and barn, less any allowed depreciation and/or loss, correct?  Can I include all settlement charges and commissions paid under 'Exchange Expenses'? Lastly, since the property also included their home, is the home sale exclusion allowed?

Any input is greatly appreciated, thanks!