9/1/2023 0 Comments Download form 4868WHEN YOU WANT THE EXCHANGE PERIOD TO EXPIRE EARLY If the exchange is incomplete, the sale will need to be reported as a taxable event. In a 1031 exchange, the taxpayer must acquire all replacement property by the earlier of the date that is 180 days from the date the relinquished property closes, or the date the tax return for the year in which the relinquished property closed is due, including extensions. This means that for exchanges where the relinquished property closes late in the year, a calendar-year taxpayer must get an extension of the tax filing deadline in order to benefit from the full 180-day exchange period. For example, if the relinquished property closes on December 1, 2022, and the taxpayer does not get an extension on the filing of his return, the taxpayer will only have until April 18, 2023 to acquire all replacement properties. If taxpayers gets an extension, however, they will have until May 30, 2023 to acquire all replacement properties. For these entities, the start filing date is still applicable.įILING AN EXTENSION TO GET THE FULL BENEFIT OF THE 180-DAY EXCHANGE PERIOD The IRS filing extension only applies to individual taxpayers – it does not apply to C-corporations, not-for-profit, or trusts. the tax year the relinquished property is transferred, using IRS Form 8824. The exchange period is the shorter of 180 days or the due date of the taxpayer’s tax return. If taxpayers' exchange transactions start late in the year, they may need to file for an extension using Form 4868 in order to receive the full benefit of the 180-day exchange period and reflect the entire exchange on the appropriate tax return. A 1031 exchange is reported on the tax return for the tax year in which the exchange begins, i.e.
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |