Form 8824 preparation support for New York City 1031 exchanges: reconciling closing statements into the reporting figures your preparer needs.
Form 8824 is filed with the tax return covering the year an exchange closed, and it is where the realized gain, recognized gain, basis, and any boot from a New York City exchange get formally reported. We do not prepare or file the form; that is the taxpayer's CPA or tax preparer's role. What we do is reconcile the relinquished-sale closing statement, the replacement-purchase closing statement, and any boot worksheet into the exact figures the preparer needs, organized the way the form itself is structured, so the filing step is fast rather than a forensic reconstruction of a five-borough transaction months after it closed.
The form asks for a description of both the relinquished and replacement properties, the dates each was transferred and identified, the fair market values involved, any liabilities assumed or relieved, and whether the exchange involved a related party. For a New York City exchange, the property description section is often where errors creep in, since a Manhattan condo unit, a Brooklyn multifamily building, and a Queens industrial parcel each have different standard ways of being legally described, and a preparer unfamiliar with the specific asset type can misdescribe a unit number or block-and-lot reference.
The form's core numeric inputs trace directly back to both closing statements: START EXCHANGE REVIEW price, selling costs, debt payoff, replacement purchase price, replacement debt, and any cash contributed or received. We build a single reconciliation sheet that maps each closing statement line item to the corresponding Form 8824 input, so the preparer is working from a source document trail rather than re-deriving numbers from memory or a verbal summary of how the deal closed.
Selling costs on the relinquished side generally include the combined New York City and New York State transfer-tax stack, and that figure needs to be pulled directly from the closing statement rather than estimated, since it reduces net proceeds and can move the recognized-gain calculation more than a preparer unfamiliar with New York City closings might expect. We flag the transfer-tax line separately from brokerage commissions and other selling costs so the preparer can see exactly what each dollar of selling expense represents.
An exchange into more than one replacement property, whether under the three-property rule or a larger list under the 200% or 95% rules, generally requires the reporting to account for each replacement property's basis allocation separately, not as a single blended number.
The replacement property's basis for future depreciation and eventual sale is generally the relinquished property's adjusted basis, carried forward and adjusted for any additional cash invested, debt assumed, or boot recognized. Getting this carryover figure right at the time of filing matters well beyond the current tax year, since it becomes the depreciation schedule the owner works from for as long as the replacement property is held, and an error compounds every year until it is caught.
A simple per-square-foot check is useful here as a sanity test rather than a substitute for the actual carryover math: if a relinquished Manhattan asset traded at a much higher price per square foot than an outer-borough industrial replacement in Queens or the Bronx, the carried-over basis, spread across substantially more square footage, produces a noticeably different depreciable basis per square foot than the seller was working with before. We flag that shift for the preparer so the new depreciation schedule is built against the actual replacement asset rather than assumptions carried over from the relinquished property's numbers.
We aim to have the reconciliation package, including both closing statements, the boot worksheet if applicable, and the property description detail, in the preparer's hands well ahead of the filing deadline, not during the final week of tax season. A New York City exchange involving a co-op board approval, a rent-stabilized rent roll, or a DST allocation often has more moving reporting parts than a simple single-property swap, and preparers do better work with more lead time on those files.
No. We assemble and reconcile the transaction data the form requires, but the form itself is prepared and filed by the taxpayer's CPA or tax preparer as part of their tax return.
Each replacement property generally needs its own basis allocation and reporting detail, even when they were acquired as part of the same overall exchange. We build the reconciliation sheet with each replacement broken out separately so the preparer isn't left blending figures that need to stay distinct.
Recognized gain from cash boot or unreplaced debt flows into the form's gain calculation and is reported as taxable in the year of the exchange. We keep the boot worksheet aligned with the closing statement figures so that number reconciles cleanly when the preparer completes the filing.
As soon as possible after the replacement property closes, rather than waiting for tax season. Exchanges with co-op board timing, rent-regulated income, or multiple replacement properties tend to need more preparer review time, and an early handoff avoids a rushed filing.
Reporting gets more complex when the relinquished property was held by multiple co-owners or inside a partnership, since each owner's exchange generally has to be evaluated on its own facts, and a partnership often cannot simply distribute a replacement interest to satisfy individual partners' separate goals. We flag any multi-owner or partnership structure at the start of the engagement so the tax preparer has enough lead time to work through the entity-level questions before the filing deadline, rather than discovering the complexity during return preparation.
Tax advisor and CPA coordination for New York City 1031 exchanges: routing boot, basis, and filing questions to the taxpayer's own advisors.
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Exchange documentation assembly for New York City 1031 exchanges: the core paper trail from sale contract through replacement closing.
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Send the sale timing, property type, target replacement path, and questions already raised by your advisor team. We will respond with the next coordination steps.