Could you help get me comfortable with the JE I'm making for the sale of our rental property?
Basis allocated between Building and Land, and Depreciation of the building through YE 2021.
Bldg (basis before sale) $ 578,961
Acc Dep. 49,124
Selling price. $1,155,000
Seller repair allowance 3,000
Document Prep QI 1,000
County Tax Stamps 8,354
-small tax prepaid credits 284
Total net proceeds $1,085,180 (to 1031 Intermediary, replaced March 2022)
Dr Asset Funds held by QI 1,085,180
Dr Asset Bldg - Commissions 57,750
Dr Asset Bldg - Doc Prep 1,000
Dr Asset Bldg - Rec Stamps 8,354
Dr Asset Bldg - Seller Allowance 3,000
Dr Acc Dep 49,124
Cr Asset Bldg 649,065
Cr Asset Land 19,040
Cr Exp - Property Tax 284
Cr Liability - Deferred Gain 1031 Exchange 536,019
Good morning, @mgbocot.
Thanks for taking the time to reach out to the QuickBooks Community for support. I hope you're enjoying the day so far.
I would love to lend a hand with creating journal entries for the sale of your rental property. However, this would be something better discussed with your certified accountant. Your accountant will know the best process to use based on your business needs and will have a broader understanding of how the journal entry would need to be created. If you don't have an accountant, don't sweat it. You can find one here in our Resource Center.
In the meantime, feel free to check out our help article that includes more information about creating journal entries in QuickBooks Desktop that I've included below.
Please let me know if you have any questions or concerns. Take care!
You most definitely should confirm this with your own CPA.
Where is the replacement property? Your exchange (even though it spans different tax years) needs to be reported on your 2021 return Form 8824 (even if the exchange was completed in 2022). If you file a return without the exchange complete, that triggers your cap gains/depreciation recapture and you lose the exchange.
Correct. Thank you so much for answering! I'm comfortable with the 8824 & was aware that the entire exchange we completed March 1, 2022 must be reported with my 2021 1065. We identified the replacement and closed the purchase in correct time frame. I'm an old cpa myself, but not in public practice & not recently involved in this type of real estate transaction. I am being really, really OCD my quickbooks December 31, 2021 financials (between the relinquished and replacement) to look right. :)