Instructions for IRS Form 8824 Like-Kind Exchanges

IRS Form 8824 Like-Kind Exchanges

This document contains official instructions for IRS Form 8824 , Like-Kind Exchanges - a tax form released and collected by the Internal Revenue Service (IRS), a subdivision of the U.S. Department of the Treasury. An up-to-date fillable IRS Form 8824 is available for download through this link.

FAQ

Q: What is IRS Form 8824?A: IRS Form 8824 is used to report like-kind exchanges of business or investment property.

Q: What is a like-kind exchange?A: A like-kind exchange is a transaction in which property is exchanged for similar property and certain tax benefits may apply.

Q: What information is required on Form 8824?A: Form 8824 requires information about the properties being exchanged, including their fair market values and any boot received.

Q: What is fair market value?A: Fair market value is the price that property would sell for on the open market.

Q: What is boot in a like-kind exchange?A: Boot is any additional cash or other property received in a like-kind exchange that is not of like-kind.

Q: Are there any deadlines for filing Form 8824?A: Yes, Form 8824 must be filed with your tax return for the year in which the like-kind exchange occurred.

Q: What are the tax benefits of a like-kind exchange?A: A like-kind exchange may allow you to defer the recognition of gain or loss on the exchange of property.

Q: Can personal property be exchanged in a like-kind exchange?A: No, like-kind exchanges generally apply to real property, not personal property.

Q: Are there any exceptions to the like-kind exchange rules?A: Yes, there are certain property types that do not qualify for like-kind exchanges, such as inventory or stocks.

Q: Can I amend Form 8824 if I made a mistake?A: Yes, you can file an amended return to correct any errors on Form 8824.