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You'll need to enter a rollover to a QO Fund as two separate dispositions in Lacerte. Per the Form 8949 instructions, you should report the original transaction as if the tax on the eligible gain is not going to be deferred. Then you should enter a separate transaction to report the amount of eligible gains on which tax will be deferred by investing in a QO Fund.

Follow these steps to report the original transaction:

  1. Go to Screen 17.1, Dispositions (Schedule D, 4797, etc.).
  2. Fill out the following fields, if applicable;
    • Description of property
    • Date acquired (negative date =various)
    • Date sold (negative date=various)
    • Taxpayer, Spouse, Joint
  3. Scroll down to the Schedule D section to complete the following fields;
    • Sales price
    • Cost or other basis (do not reduce by depreciation)

Do not make any adjustments to this transaction. Leave the Qualified Opportunity Fund subsection completely blank. Enter this transaction as if it's a general disposition.

Follow these steps to report the Qualified Opportunity Fund Transaction:

  1. While still on Screen 17.1, Dispositions (Schedule D, 4797, etc.).
  2. In the left navigation panel, within the Disposition section, click Add.
  3. Enter a Description of property.
  4. Enter the Date acquired.
  5. Scroll down to the Schedule D section.
  6. Enter a '2' in the field Reported on: blank = Form 1099-B with basis reported to IRS, 1=Form 1099-B but basis not reported to IRS, 2=form other than Form 1099-B (Form 8949).
  7. While still within the Schedule D section, scroll down to the Qualified Opportunity Fund subsection.
  8. Check the box Rollover to Qualified Opportunity Fund.
  9. Enter a '1' or 2 in 1=short-term, 2=long-term.
  10. Enter the Deferred gain. This should be the amount of gain for which tax will be deferred.
  11. Enter the fund's tax identification number in TIN of QO Fund.

The program will report the deferred gain as a negative amount on its own row of Form 8949 along with the QO Fund's information.

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