How JustAnswer Works:
  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site.
    Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.
Ask Maverick Your Own Question
Maverick
Maverick, Lawyer
Category: Real Estate Law
Satisfied Customers: 6386
Experience:  20 years professional experience
16823287
Type Your Real Estate Law Question Here...
Maverick is online now
A new question is answered every 9 seconds

If my basis in the residence is determined by reference to

Customer Question

If my basis in the residence is determined by reference to the basis in the hands of a person who acquired the residence in an exchange to which section 1031 of the IRS code applied, the exchange to which section 1031 applied occurred more than 5 (five) years prior to the date I sold or exchanged the residence."
JA: Where is the property located?
Customer: Gilbert AZ I am selling the home & moving to an apartment, not re-investing in another property
JA: Has any paperwork been filed?
Customer: Yes, I'm working on "certification for not information report on the sale or exchange of a principal residence"
JA: Anything else you want the lawyer to know before I connect you?
Customer: nope
Submitted: 7 months ago.
Category: Real Estate Law
Customer: replied 7 months ago.
my options are "True", "False", or "NA" I'm not sure which one applys
Expert:  Maverick replied 7 months ago.

Welcome to Just Answer! My name is***** give me a few minutes to review your inquiry. Thank you for your patience.

Expert:  Maverick replied 7 months ago.

I am not sure I understand what you specific question is; but the general concept in like-kind exchanges is that gain is deferred, but not forgiven.

One must calculate and keep track of his basis in the new property he acquired in the exchange. In general, the basis of property acquired in a Section 1031 exchange is the basis of the property you gave up with some adjustments.

This transfer of basis from the relinquished to the replacement property preserves the deferred gain for later recognition. When the replacement property is ultimately sold (i.e. not as part of another exchange), then the original deferred gain, plus any additional gain realized since the purchase of the replacement property, is subject to tax.

Does this answer your question?

Please Note:

(1) The information I provide is general in nature and for educational purposes only. For example, it may help you identify the scope of receiving unbundled legal services from a local lawyer. It should not be construed as “legal advice” or as the rendition of “legal services” on any subject matter. I am not a specialist in any field. This information may not reflect current legal developments for your specific jurisdiction and is not guaranteed to be correct or complete. No attorney-client relationship is established without a signed written agreement and our communications are not confidential. Please do not act or fail to act based on this information alone. If you need legal advice or services regarding a specific matter, you should consult in-person with a local lawyer who can guide you after reviewing all the pertinent details of your situation. This disclaimer also applies to any telephone communications we may have.

(2) Most follow-up questions are answered with in the hour; however, if I am not signed on, please allow up to 24 hours.

(3) When we are done, please assign a feedback rating.

Customer: replied 7 months ago.
No I still do not understand.
I am filling out "certification for not information report on the sale or exchange of a principal residence"
I came upon this item:
"If my basis in the residence is determined by reference to the basis in the hands of a person who acquired the residence in an exchange to which section 1031 of the IRS code applied, the exchange to which section 1031 applied occurred more than 5 (five) years prior to the date I sold or exchanged the residence."
the options are:
"True", "False", or "NA" I'm not sure which one to chooseI have never owned a home prior to this one, I have owned the home for 4 years now (purchased traditionally with a loan, not transferred to me), I will not be buying another home for a minimum of 1 year after this home sells.
Customer: replied 7 months ago.
34;Certification for no information reporting on the sale or exchange of a principal residence"
Expert:  Maverick replied 7 months ago.

1. If my basis in the residence is determined by reference to the basis in the hands of a person who acquired the residence in an exchange to which section 1031 of the Internal Revenue Code applied

What this appears to be saying is that if your basis in this home is determined by the basis of a seller who acquired the residence as a result of a like-kind exchange, then it is asking you whether it is true that such exchange occurred more than 5 years before the date you sold or exchanged the residence.

Does this make any sense in the context of your purchase of this home? If not, then you may want to consider checking "NA".

Please Note:

(1) The information I provide is general in nature and for educational purposes only. For example, it may help you identify the scope of receiving unbundled legal services from a local lawyer. It should not be construed as “legal advice” or as the rendition of “legal services” on any subject matter. I am not a specialist in any field. This information may not reflect current legal developments for your specific jurisdiction and is not guaranteed to be correct or complete. No attorney-client relationship is established without a signed written agreement and our communications are not confidential. Please do not act or fail to act based on this information alone. If you need legal advice or services regarding a specific matter, you should consult in-person with a local lawyer who can guide you after reviewing all the pertinent details of your situation. This disclaimer also applies to any telephone communications we may have.

(2) Most follow-up questions are answered with in the hour; however, if I am not signed on, please allow up to 24 hours.

(3) When we are done, please assign a feedback rating.