Like-Kind Exchanges

Form 8824

(and section 1043 conflict-of-interest sales)

Department of the Treasury

Internal Revenue Service  Attach to your tax return. 

Name(s) shown on tax return Identifying 

Information on the Like-Kind Exchange

1 Description of like-kind property given up 

2 Description of like-kind property received 

3 Date like-kind property given up was originally acquired (month, day, year) 3 

4 Date you actually transferred your property to other party (month, day, year) 4 

5 

Date like-kind property you received was identified by written notice to another party (see

instructions for 45-day written notice requirement) (month, day, year)

5

6 Date you actually received the like-kind property from other party (month, day, year) (see instructions) 6 

7 Was the exchange of the property given up or received made with a related party, either directly or indirect

(such as through an intermediary) (see instructions)? If “Yes,” complete Part II. If “No,” go to Part III

8 Name of related party Related pa

Address (no., street, and apt., room, or suite no., city or town, state, and ZIP code)

Relationship to you

During this tax year (and before the date that is 2 years after the last transfer of property that was part of th

exchange), did the related party directly or indirectly (such as through an intermediary) sell or dispose of an

part of the like-kind property received from you in the exchange?

9

During this tax year (and before the date that is 2 years after the last transfer of property that was part of th

exchange), did you sell or dispose of any part of the like-kind property you received?

10

If both lines 9 and 10 are “No” and this is the year of the exchange, go to Part III. If both lines 9 and 10 are “No” 

year of the exchange, stop here. If either line 9 or line 10 is “Yes,” complete Part III and report on this year’s tax 

gain or (loss) from line 24 unless one of the exceptions on line 11 applies.

11 If one of the exceptions below applies to the disposition, check the applicable box:

The disposition was after the death of either of the related parties.

The disposition was an involuntary conversion, and the threat of conversion occurred after the exchan

You can establish to the satisfaction of the IRS that neither the exchange nor the disposition had tax 

principal purpose. If this box is checked, attach an explanation (see instructions).

Caution: If you transferred and received (a) more than one group of like-kind properties or (b) cash or other (not 

see Reporting of multi-asset exchanges in the instructions.

Note: Complete lines 12 through 14 only if you gave up property that was not like-kind. Otherwise, go to 

12 Fair market value (FMV) of other property given up 12

13 Adjusted basis of other property given up 13

Gain or (loss) recognized on other property given up. Subtract line 13 from line 12. Report the

gain or (loss) in the same manner as if the exchange had been a sale

14

14

15 Cash received, FMV of other property received, plus net liabilities assumed by other party, reduced

(but not below zero) by any exchange expenses you incurred (see instructions) 15

16 FMV of like-kind property you received 16

17 Add lines 15 and 16 17

Adjusted basis of like-kind property you gave up, net amounts paid to other party, plus any

exchange expenses not used on line 15 (see instructions)

18

18

19 Realized gain or (loss). Subtract line 18 from line 17 19

20 Enter the smaller of line 15 or line 19, but not less than zero 20

21 Ordinary income under recapture rules. Enter here and on Form 4797, line 16 (see instructions) 21

Basis of like-kind property received. Subtract line 15 from the sum of lines 18 and 23

22

22

For Paperwork Reduction Act Notice, see page 4. Cat. No. 12311A 

Part I

Realized Gain or (Loss), Recognized Gain, and Basis of Like-Kind Property Received

Note: If the property described on line 1 or line 2 is real or personal property located outside the United States, in

23

24 Deferred gain or (loss). Subtract line 23 from line 19. If a related party exchange, see instructions

Subtract line 21 from line 20. If zero or less, enter -0-. If more than zero, enter here and on Schedule

D or Form 4797, unless the installment method applies (see instructions)

Recognized gain. Add lines 21 and 22

25

23

24

25

a

b

c

Part III

Part II Related Party Exchange Information
Form 8824 (2004) 

Deferral of Gain From Section 1043 Conflict-of-Interest Sales

Description of divested property 

Description of replacement property 

Date divested property was sold (month, day, year) 29 

Sales price of divested property (see instructions) 30

26

31

27

Basis of divested property

Realized gain. Subtract line 31 from line 30

28

33

29

Cost of replacement property purchased within 60 days after date

of sale

30

34

31

Ordinary income under recapture rules. Enter here and on Form 4797, line 10 (see instructions)

Basis of replacement property. Subtract line 37 from line 33

32

35

Note: This part is to be used only by officers or employees of the executive branch of the Federal Govern

nonrecognition of gain under section 1043 on the sale of property to comply with the conflict-of-interest r

part can be used only if the cost of the replacement property exceeds the basis of the divested property.

Name(s) shown on tax return. Do not enter name and social security number if shown on other side. Your socia

33

34

35

36

37

38

Subtract line 33 from line 30. If zero or less, enter -0-

Subtract line 35 from line 34. If zero or less, enter -0-. If more than zero, enter here and on

Schedule D or Form 4797 (see instructions)

Deferred gain. Subtract the sum of lines 35 and 36 from line 32

36

Part IV

Enter the number from the upper right corner of your certificate of divestiture. (Do not attach a

copy of your certificate. Keep the certificate with your records.) 

37

38

32

Section references are to the Internal

Revenue Code unless otherwise noted.

General Instructions

Purpose of Form

Use Parts I, II, and III of Form 8824 to report

each exchange of business or investment

property for property of a like kind. Certain

members of the executive branch of the

Federal Government use Part IV to elect to

defer gain on conflict-of-interest sales.

If during the current tax year you transferred

property to another party in a like-kind

exchange, you must file Form 8824 with your

tax return for that year. Also file Form 8824

Like-Kind Exchanges

Generally, if you exchange business or

investment property solely for business or

investment property of a like kind, no gain or

loss is recognized under section 1031. If, as

part of the exchange, you also receive other

(not like-kind) property or money, gain is

recognized to the extent of the other property

and money received, but a loss is not

recognized.

Section 1031 does not apply to exchanges

of inventory, stocks, bonds, notes, other

securities or evidence of indebtedness, or

certain other assets. See section 1031(a)(2).

In addition, section 1031 does not apply to

certain exchanges involving tax-exempt use

property subject to a lease. See section

470(e)(4).

Multiple exchanges. If you made more

than one like-kind exchange, you may file

only a summary Form 8824 and attach your

own statement showing all the information

requested on Form 8824 for each exchange.

Include your name and identifying number at

the top of each page of the statement. On the

summary Form 8824, enter only your name

and identifying number, “Summary” on line 1,

the total recognized gain from all exchanges

on line 23, and the total basis of all like-kind

property received on line 25.

Real properties generall

regardless of whether they 

unimproved. However, rea

United States and real pro

United States are not like-

When To File

Deferred exchanges. A d

occurs when the property 

exchange is received afte

property given up. For a d

qualify as like-kind, you m

45-day written notice and 

requirements explained in 

lines 5 and 6.

Like-kind property. Properties are of like

kind if they are of the same nature or

character, even if they differ in grade or

quality. Personal properties of a like class are

like-kind properties. However, livestock of

different sexes are not like-kind properties.

Also, personal property used predominantly in

the United States and personal property used

predominantly outside the United States are

Multi-asset exchanges. A 

exchange involves the tra

more than one group of li

For example, an exchange 

and cash for land and veh

multi-asset exchange. An 

vehicles, and cash for lan

multi-asset exchange. The 

of multiple properties with

group is also a multi-asse

rules apply when figuring 

recognized and your basis 

received in a multi-asset e

details, see Regulations s

not like-kind properties. S

and Other Dispositions of 

details.

for the 2 years following the year of a related

party exchange (see the instructions for line 7

on page 3).
Form 8824 (2004) 

Reporting of multi-asset exchanges. If

you transferred and received (a) more than

one group of like-kind properties or

(b) cash or other (not like-kind) property, do

not complete lines 12 through 18 of Form

8824. Instead, attach your own statement

showing how you figured the realized and

recognized gain, and enter the correct

amount on lines 19 through 25. Report any

recognized gains on Schedule D; Form 4797,

Sales of Business Property; or Form 6252,

Installment Sale Income, whichever applies.

Lines 1 and 2. For real property, enter the

address and type of property. For personal

property, enter a short description. For

property located outside the United States,

include the country.

Line 7. Special rules apply to like-kind

exchanges made with related parties, either

directly or indirectly. A related party includes

your spouse, child, grandchild, parent,

grandparent, brother, sister, or a related

corporation, S corporation, partnership, trust,

or estate. See section 1031(f).

Line 11c. If you believe th

establish to the satisfactio

tax avoidance was not a p

both the exchange and th

an explanation. Generally, 

not be seen as a principa

case of:

Lines 12, 13, and 14. If y

property in addition to the 

enter the fair market value 

adjusted basis of the othe

12 and 13, respectively. T

from this property is figure

must be reported on your 

or (loss) as if the exchang

Line 15. Include on line 1

● Any cash paid to you b

Specific Instructions

● The FMV of other (not l

you received, if any, and

● Net liabilities assumed 

party—the excess, if any, 

(including mortgages) ass

party over the total of (a) a

assumed, (b) cash you pa

party, and (c) the FMV of 

like-kind) property you gav

● A nonrecourse liability g

as assumed by the party 

property subject to the lia

owner of other assets sub

liability agrees with the pa

property to, and is expect

all of the liability, the amo

assumed is reduced by th

amount of the liability that 

other assets has agreed t

satisfy or (b) the FMV of t

Reduce the sum of the 

not below zero) by any ex

you incurred. See the exa

The following rules app

amount of liability treated 

● A recourse liability (or p

treated as assumed by th

property if that party has 

expected to satisfy the lia

thereof). It does not matte

transferring the property h

the liability.

Additional information. For more information

on like-kind exchanges, see section 1031 and

its regulations and Pub. 544.

Line 5. Enter on line 5 the date of the written

notice that identifies the like-kind property

you received in a deferred exchange. To

comply with the 45-day written notice

requirement, the following conditions must

be met.

1. The like-kind property you receive in a

deferred exchange must be designated in

writing as replacement property either in a

document you signed or in a written

agreement signed by all parties to the

exchange.

2. The document or agreement must

describe the replacement property in a clear

and recognizable manner. Real property

should be described using a legal description,

street address, or distinguishable name (for

example, “Mayfair Apartment Building”).

3. No later than 45 days after the date you

transferred the property you gave up:

b. All parties to the exchange must sign the

written agreement designating the

replacement property.

Generally, a disqualified person is either

your agent at the time of the transaction or a

person related to you. For more details, see

Regulations section 1.1031(k)-1(k).

Note. If you received the replacement

property before the end of the 45-day period,

you automatically are treated as having met

the 45-day written notice requirement. In this

case, enter on line 5 the date you received

the replacement property.

Line 6. Enter on line 6 the date you received

the like-kind property from the other party.

The property must be received by the earlier

of the following dates.

● The 180th day after the date you

transferred the property given up in the

exchange.

● The due date (including extensions) of your

tax return for the year in which you

transferred the property given up.

If the related party (either directly or

indirectly) or you dispose of the property

received in an exchange before the date that

is 2 years after the last transfer of property

from the exchange, the deferred gain or (loss)

from line 24 must be reported on your return

for the year of disposition (unless an

exception on line 11 applies).

If you are filing this form for 1 of the 2

years following the year of the exchange,

complete Parts I and II. If both lines 9 and 10

are “No,” stop.

a. You must send, fax, or hand deliver the

document you signed to the person required

to transfer the replacement property to you

(including a disqualified person) or to another

person involved in the exchange (other than a

disqualified person), or

Line 18. Include on line 1

● Net amount paid to the 

excess, if any, of the tota

you assumed, (b) cash yo

party, and (c) the FMV of 

like-kind) property you ga

liabilities assumed by the 

See Regulations section 

the following example for 

enter on lines 15 and 18.

● The adjusted basis of th

you gave up,

● Exchange expenses, if 

expenses used to reduce 

reported on line 15), and

● An exchange made with a related party

through an intermediary (such as a qualified

intermediary or an exchange accommodation

titleholder, as defined in Pub. 544), or

● An exchange made by a disregarded entity

(such as a single member limited liability

company) if you or a related party owned that

entity.

An exchange made indirectly with a

related party includes:

If either line 9 or line 10 is “Yes,” and an

exception on line 11 applies, check the

applicable box on line 11, attach any required

explanation, and stop. If no line 11

exceptions apply, complete Part III. Report

the deferred gain or (loss) from line 24 on this

year’s tax return as if the exchange had been

a sale.

An exchange structured to avoid the

related party rules is not a like-kind exchange

and may not be reported on Form 8824.

Instead, you should report the disposition of

the property given up as if the exchange had

been a sale. See section 1031(f)(4). Such an

exchange includes the transfer of property

you gave up to a qualifed intermediary in

exchange for property you received that was

formerly owned by a related party if the

related party received cash or other (not

like-kind) property for the property you

received, and you used the qualified

intermediary to avoid the application of the

related party rules. See Rev. Rul. 2002-83 for

more details. You can find Rev. Rul. 2002-83

on page 927 of Internal Revenue Bulletin

2002-49 at

www.irs.gov/pub/irs-irbs/irb02-49.pdf.

Exchanges using a qualified exchange

accommodation arrangement (QEAA). If

property is transferred to an exchange

accommodation titleholder (EAT) and held in a

QEAA, the EAT may be treated as the

beneficial owner of the property, the property

transferred from the EAT to you may be

treated as property you received in an

exchange, and the property you transferred to

the EAT may be treated as property you gave

up in an exchange. This may be true even if

the property you are to receive is transferred

to the EAT before you transfer the property

you are giving up. However, the property

transferred to you may not be treated as

property received in an exchange if you

previously owned it within 180 days of its

transfer to the EAT. For details, see Rev.

Proc. 2000-37 as modified by Rev. Proc.

2004-51. Rev. Proc. 2000-37 is on page 308

of Internal Revenue Bulletin 2000-40 at

www.irs.gov/pub/irs-irbs/irb00-40.pdf. Rev.

Proc. 2004-51 is on page 294 of Internal

Revenue Bulletin 2004-33 at

www.irs.gov/irb/2004-33_IRB/ar13.html.

● A disposition of propert

nonrecognition transaction

● An exchange in which t

derive no tax advantage f

basis between the exchan

● An exchange of undivid

different properties that re

party holding either the en

single property or a larger 

in any of the properties.
Form 8824 (2004) 

1. See section 453(f)(6) to determine the

installment sale income taxable for this year

and report it on Form 6252.

Do not enter more than the amount shown on

Form 6252, line 24 or 35.

4. If all the ordinary income is not

recaptured this year, report in future years on

Form 6252 the ordinary income up to the

taxable installment sale income, until it is all

reported.

Line 22. Report a gain from the exchange of

property used in a trade or business (and

other noncapital assets) on

Form 4797, line 5 or line 16. Report a gain

from the exchange of capital assets

according to the Schedule D instructions for

your return. Be sure to use the date of the

exchange as the date for reporting the gain. If

the installment method applies to this

exchange, see section 453(f)(6) to determine

the installment sale income taxable for this

year and report it on Form 6252.

Line 24. If line 19 is a loss, enter it on

line 24. Otherwise, subtract the amount on

line 23 from the amount on line 19 and enter

the result. For exchanges with related parties,

see the instructions for line 7 on page 3.

Line 25. The amount on line 25 is your basis

in the like-kind property you received in the

exchange. Your basis in other property

received in the exchange, if any, is its FMV.

If you sell property at a gain according to a

certificate of divestiture issued by the Office

of Government Ethics (OGE) and purchase

replacement property (permitted property),

you may elect to defer part or all of the

realized gain. You must recognize gain on the

sale only to the extent that the amount

realized on the sale exceeds the cost of

replacement property purchased within 60

days after the sale. (You also must recognize

any ordinary income recapture.) Permitted

property is any obligation of the United States

or any diversified investment fund approved

by the OGE.

Complete Part IV of Form 8824 only if the

cost of the replacement property exceeds the

basis of the divested property and you elect

to defer the gain. Otherwise, report the sale

on Schedule D or Form 4797, whichever

applies.

Line 30. Enter the amoun

the sale of the divested p

selling expenses.

Line 35. Follow these ste

amount to enter.

2. Enter on Form 8824, 

from Form 4797, line 31. 

Form 4797 used as a wor

return.

Line 36. If you sold a cap

capital gain from line 36 o

you sold property used in 

(or any other asset for wh

treated as ordinary incom

on Form 4797, line 2 or lin

column (a), write “From Fo

Do not complete columns 

3. Also enter this amount on Form 4797,

line 15.

Section 1043

Conflict-of-Interest Sales

(Part IV)

1. Use Part III of Form 4

to figure ordinary income 

rules.

3. Report the amount fr

4797, line 10, column (g). 

“From Form 8824, line 35

columns (b) through (f).

replacement property, red

the replacement property 

acquired.

Paperwork Reduction Ac

for the information on this 

the Internal Revenue laws 

States. You are required t

information. We need it to 

complying with these laws 

figure and collect the righ

You are not required to 

information requested on 

subject to the Paperwork 

unless the form displays a 

number. Books or records 

or its instructions must be 

their contents may becom

administration of any Inter

Generally, tax returns and 

are confidential, as require

The time needed to com

form will vary depending o

circumstances. The estim

is:

Recordkeeping 

Learning about the

law or the form 

Preparing the form 

Copying, assembling, an

sending the form to the 

If you have comments c

accuracy of these time es

suggestions for making th

would be happy to hear fr

instructions for the tax ret

form is filed.

B enters $30,000 on line 15—the excess of

the $150,000 of liabilities assumed by A over

the total ($120,000) of the $80,000 of

liabilities B assumed and the $40,000 cash B

paid. B enters on line 18 only the adjusted

basis of $175,000 because the total of the

$80,000 of liabilities B assumed and the

$40,000 cash B paid does not exceed the

$150,000 of liabilities assumed by A.

Line 21. If you disposed of section 1245,

1250, 1252, 1254, or 1255 property (see the

instructions for Part III of Form 4797), you

may be required to recapture as ordinary

income part or all of the realized gain (line

19). Figure the amount to enter on line 21 as

follows:

A transfers his apartment house to B and

receives in exchange B’s apartment house

plus $40,000 cash. A assumes the mortgage

on the apartment house received from B, and

B assumes the mortgage on the apartment

house received from A.

A enters on line 15 only the $40,000 cash

received from B. The $80,000 of liabilities

assumed by B is not included because it

does not exceed the $150,000 of liabilities A

assumed. A enters $170,000 on line 18—the

$100,000 adjusted basis, plus the $70,000

excess of the liabilities A assumed over the

liabilities assumed by B ($150,000 - $80,000).

Example. A owns an apartment house with

an FMV of $220,000, an adjusted basis of

$100,000, and subject to a mortgage of

$80,000. B owns an apartment house with an

FMV of $250,000, an adjusted basis of

$175,000, and subject to a mortgage of

$150,000.

Section 1245 property. Enter the smaller of:

1. The total adjustments for deductions

(whether for the same or other property)

allowed or allowable to you or any other

person for depreciation or amortization (up to

the amount of gain shown on line 19), or

2. The gain shown on line 20, if any, plus

the FMV of non-section 1245 like-kind

property received.

Section 1250 property. Enter the smaller of:

1. The gain you would have had to report

as ordinary income because of additional

depreciation if you had sold the property (see

the Form 4797 instructions for line 26), or

2. The larger of:

a. The gain shown on line 20, if any, or

b. The excess, if any, of the gain in

item 1 above over the FMV of the section

1250 property received.

If the property you sold was stock

you acquired by exercising a

statutory stock option, you may be

treated as meeting the holding

periods that apply to such stock, regardless of

how long you actually held the stock. This may

benefit you if you do not defer your entire gain

by allowing you to treat the gain as a capital

gain instead of ordinary income. You must have

sold the stock after October 22, 2004. For

details, see section 421(d) or Pub. 525.

Section 1252, 1254, and 1255 property. The

rules for these types of property are similar to

those for section 1245 property. See

Regulations section 1.1252-2(d) and

Temporary Regulations section 16A.1255-2(c)

for details. If the installment method applies to

this exchange:

TIP

2. Enter on Form 6252, line 25 or 36, the

section 1252, 1254, or 1255 recapture

amount you figured on Form 8824, line 21.

Your basis in the replacement property is

reduced by the amount of the deferred gain.

If you made more than one purchase of