- Date of Sale
- Date the investment real estate will be sold.
- Date of Purchase
- Date the purchase of the replacement property(ies) will take place. Exchange must be completed within 180 days from date of sale and meet all other exchange requirements to qualify for tax deferral.
- Description of Property
- Optional brief description of the property involved in this exchange.
- Adjusted Cost Basis
- The adjusted basis of investment real estate being sold. Your tax professional can help you calculate this value based on improvements made and allowable deductions taken during your ownership period.
- Sales Price
- The contracted sales price of the investment property sold.
- Sales Cost, Commissions and Exchange Fee
- Expenses associated with the sale that are the responsibility of the seller. May include commissions, title insurance, closing costs, exchange fee, etc. This should not include items paid at closing that are not subtracted from the basis of the property. Generally this would include items that would be expensed such as interest, escrow and insurance payments.
- Net Sale for Property Sold
- The contracted sales price minus sales costs, commissions and exchange fee.
- Net Cash Received
- Net sale minus liabilities or mortgages on the investment real estate sold. This amount goes into the exchange account and, to avoid any tax, must all be reinvested into the investment real estate purchased.
- Purchase Price
- The contracted purchase price of the replacement investment real estate.
- Purchase Costs and Commissions
- Expenses associated with the purchase that are the responsibility of the buyer. May include commissions, title insurance, closing costs, etc. This should not include items paid at closing that not added to the basis of the property. Generally this would include items that would be expensed such as prepaid interest, escrow and insurance payments.
- Net Cost for Property Purchased
- The contracted sales price minus sales costs, commissions and exchange fee.
- Net Cash Reinvested
- Net sale minus liabilities or mortgages on the investment real estate purchased in the exchange. To avoid any tax, this amount must be greater than than the net cash generated by the property being sold.
- Less Liabilities/Mortgages
- Any liabilities or mortgages on the property.
- Recognized Gain
- The taxable amount of the transaction. If there is no 1031 exchange, it is the difference between the net sales price and the adjusted cost basis. If a 1031 exchange is performed, it is any amount purchased less than the net sale OR any amount of cash taken from the net proceeds (often referred to as "boot").
- Basis of Property Sold
- This is the original adjusted basis plus any amount purchased greater than the net sale.
