Browse articles

Follow these steps to enter information for an exchange of qualifying and like-kind property. Onvio automatically creates the replacement asset and transfers the information to the appropriate tax forms. See IRS Pub 544 . ( What's this?) or Reg. section 1.1031(a)-2(b)(1) for more information.

Follow these steps to place an asset out of service.

1. Open the asset in Onvio Fixed Assets, then open the Disposal tab
2. Select Like-kind Exchange from the Disposal Method drop-down.

Onvio Fixed Assets does not automatically handle exchanges involving non-qualifying property; it assumes that all losses are unrecognized

• Use Sold/scrapped as the disposal method to dispose of a Section 1245 asset as a like-kind exchange for book or state purposes for tax years beginning 2018 and later.
• Like-kind exchange disposal information transfers to the appropriate form in Onvio Tax 990 and 1041, if you have licensed it. However, you may need to enter additional information on Form 8824.

Calculation

FMV of other property given up

If other property in addition to the like-kind property was given up, enter the fair market value of the other property.

Adj basis of other property given up

If other property in addition to the like-kind property was given up, enter the adjusted basis of the other property.

FMV of other (not like-kind) property received

If property was given up in addition to the like-kind property, enter the fair market value of the property in this field.

Installment obligation received

Enter the amount of installment obligation received if at least one payment on the note is to be received after the close of the tax year in which the disposition occurred.

FMV of non sec 1245 like-kind property received

Enter the fair market value of any non section 1245 like-kind property received. This includes any non section 1245 property entered in the FMV of like-kind property received below. This field should be used only for like-kind exchanges with 1245 property.

Total amount realized

Onvio Fixed Assets calculates the total amount realized in the exchange and displays it here.

Adjusted basis of original asset

This is the original basis of the asset calculated with depreciation allowed or allowable.

Gain realized

This field displays the recognized gain for the Tax treatment.

Gain recognized/(loss) realized

This field displays the recognized gain or realized loss for the Tax treatment.

Type of Property

From the drop-down list, select the type of property being disposed of to determine which part of Form 4797 applies. Information does not print on Form 4797 for assets disposed of through a like-kind exchange.

Real Property button

Click this button to open a dialog in which you can specify section 1250 information. This button is available only for assets with a 25-year or greater MACRS life when casualty / theft - replacement, casualty / theft - no replacement, or like-kind exchange method of disposal is selected.

Book Calculation button

Click this button to open a panel to view and adjust the asset's Book calculation.

Related Party Exchange button

Click this button to open a panel to enter related party exchange information, if appropriate.

State Information button

Click this button to open a panel to enter state information for clients’ assets that have been exchanged in a like-kind exchange. This dialog is applicable for the following states: Idaho, Iowa, Kansas, Massachusetts, New Hampshire, Oklahoma, Pennsylvania, Vermont, and Wisconsin.

Replacement Asset

Asset number

When an asset is disposed of through a like-kind exchange or through casualty / theft with a replacement asset, the application automatically creates the new asset and enters the next available asset number in this field.

Adj Tax basis

Onvio Fixed Assets displays the Tax treatment's adjusted basis in this field.

Adj Book basis

Onvio Fixed Assets displays the Book treatment's adjusted basis in this field.

Treat entire basis as current year acquisition (Election 1.168(i)-6(i))

Mark this checkbox to elect to treat the entire basis of the replacement property as a current-year acquisition. When you mark this checkbox, an election statement prints with Form 4562.