Tax free exchange , client deposits proceeds into personal account and there is no intermediary. Is exchange now taxable?

Forum|Forum|6 years ago
December 7, 2019
3 replies
19 views

Client did use an intermediary for a tax free exchange, met rules of time and property but deposited proceeds of sale into personal account. I believe this makes it a taxable transaction. Just looking for confirmation, or something I missed that will let It remain a tax free exchange.

Lacerte Tax

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Best answer by Accountant-Man

Yes, it's a taxable sale. There is no 1031.

Accountant-ManAnswer

Level 13

Yes, it's a taxable sale. There is no 1031.

** I'm still a champion... of the world! Even without The Lounge.

George4Tacks

Level 15

I believe this is NOT a qualified delayed exchange. 1031 grew out of two farmers meeting and swapping pigs (cows, whatever). With real estate doing a same day exchange was difficult, so the Starker exchange came about. The key to Starker winning his case was the intermediary.

Answers are easy. Questions are hard!

IRonMaN

Level 15

I often get curious and here I go again doing so. If they went through an intermediary, how in the world did the cash end up in the client's bank account? I hope the intermediary didn't make a lot of money on this deal.

Slava Ukraini!

George4Tacks

Level 15

"there is no intermediary"

Answers are easy. Questions are hard!

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