Discussion:1033 Involuntary Conversions
From TaxAlmanac, A Free Online Resource
Note: You are using this website at your own risk, subject to our Disclaimer and Website Use and Contribution Terms.
From TaxAlmanac
Discussion Forum Index --> Advanced Tax Questions --> 1033 Involuntary Conversions
Discussion Forum Index --> Tax Questions --> 1033 Involuntary Conversions
| 2 April 2008 | |
| Rental property burned down by fire. Insurance paid for damages. He later sold property at a gain.
Involuntary conversion rules states he needs to buy a "like kind" replacement property to not recognize a gain. Question is, does he have to put ALL the cash from this transaction into the new replacement property? Or can he not use the cash and get a mortgage instead? Rule says the cost basis has to be higher than the old one.......Can't find anything on the use of funds. Thanks. Not very experienced with Involuntary Conversions. | |
| 4 April 2008 | |
| The like-kind standard applies to condemnations -- not fires. For a fire, you would need to apply the similar or related in service or use test. Borrowed money can be used to make the replacement. | |
To join in on this discussion, you must first
log in.
