1031 Exchange Form 8824: How to Report a Like-Kind Exchange

Q: What is the deadline to file Form 8824?

Form 8824 is filed with your federal income tax return, so it is due by the return due date—typically April 15, or October 15 if you file an extension. Note that filing an extension does not extend the 180-day exchange deadline, which is based on the actual closing date of the relinquished property, not the tax filing deadline.

By RE Tax Calc Editorial · Published October 22, 2026

After completing a 1031 exchange, you report it to the IRS on Form 8824—the form that documents the properties exchanged, calculates the deferred gain, and establishes the adjusted basis in your replacement property.

Quick Answer IRS Form 8824 (Like-Kind Exchanges) is the tax form for reporting a 1031 exchange. You file it with your federal income tax return for the year you sold the relinquished property. The form calculates how much gain is deferred and what your adjusted basis is in the replacement property.

IRS Rule IRC §1031(a)(3) requires that a deferred like-kind exchange be reported on Form 8824, filed with the taxpayer's income tax return for the year in which the exchange is initiated (the year the relinquished property is transferred). Treasury Regulation §1.1031(k)-1 provides the rules governing deferred exchanges, and the form instructions provide the mechanics for calculating realized gain, recognized gain (if any), deferred gain, and replacement property basis.

Overview of Form 8824

Form 8824 is a multi-part form that the IRS uses to track like-kind exchanges. When you complete a qualifying 1031 exchange, this form establishes the paper trail connecting your relinquished property, the qualified intermediary, the exchange funds, and the replacement property. The form is also where the IRS sees the deferred gain that will eventually be taxable when you sell the replacement property without another exchange.

The form has four main parts:

Part I — Information on the Like-Kind Exchange: Identifies both properties (descriptions, addresses, dates acquired, dates transferred or received), the qualified intermediary, and the exchange period dates.

Part II — Related Party Exchange Information: If the exchange involves related parties, special rules apply under IRC §1031(f). This part captures any related-party relationship between the taxpayer and the person they acquired the replacement property from or sold the relinquished property to.

Part III — Realized Gain or (Loss), Recognized Gain, and Basis of Like-Kind Property Received: This is the computation section. It calculates your total realized gain, any boot received (which is taxable), the deferred gain, and the adjusted basis in the replacement property.

Part IV — Deferral of Gain From Section 1043 Conflict-of-Interest Sales: This is used only by federal employees in conflict-of-interest sales and is not relevant for typical real estate investors.

Key lines on Form 8824 explained

Lines 1-4 (Part I): Enter the description and location of the relinquished property (property given up) and the replacement property (property received). Include the date you acquired the relinquished property, the date you transferred it, the date you identified the replacement property, and the date you received the replacement property.

Line 12 — Fair market value of like-kind property received: The FMV of the replacement property. This is typically the purchase price, though in exchanges with unusual terms it may differ from purchase price.

Line 13 — Fair market value of other property received (boot): The cash or non-like-kind property you received from the exchange. If you received no boot, this is $0.

Line 15 — Adjusted basis of like-kind property exchanged: Your adjusted basis in the relinquished property at the time of the exchange. This is your original cost plus improvements minus accumulated depreciation.

Line 16 — Adjusted basis of other property given up: If you gave up non-like-kind property as part of the exchange, its basis goes here. In most real estate exchanges this is $0.

Line 18 — Realized gain or (loss): FMV of everything received minus the adjusted basis of everything given up. This is the total economic gain from the transaction.

Line 21 — Recognized gain: The amount of gain that is currently taxable—typically equal to boot received, but limited to realized gain. In a fully qualifying exchange with no boot, this is $0.

Line 24 — Deferred gain: Realized gain minus recognized gain. This is the amount of gain that is not currently taxable and instead carries forward into the replacement property as a lower basis.

Line 25 — Basis of like-kind property received: The adjusted basis in your replacement property. Formula: FMV of replacement property minus deferred gain. This lower-than-FMV basis ensures the deferred gain will be recognized in the future.

Worked example: $400,000 to $500,000 exchange

An investor purchased a duplex in 2018 for $280,000 (land: $56,000; building: $224,000). By late 2026, accumulated MACRS depreciation on the building totals $65,600 ($224,000 ÷ 27.5 years × 8.05 years). The investor sells the duplex for $400,000 and exchanges into a $500,000 triplex, taking on a $100,000 mortgage on the replacement. No mortgage existed on the relinquished property.

Adjusted basis of relinquished property: $280,000 − $65,600 depreciation = $214,400.

Amount realized from relinquished property: $400,000 selling price (no mortgages on relinquished property).

Realized gain (Line 18): $400,000 − $214,400 = $185,600.

Boot received: $0. The investor used all $400,000 exchange funds and added cash for the balance. The $100,000 mortgage assumed on the replacement is not boot because it is additional financing, not cash received. The investor wrote a personal check for the $100,000 difference between exchange funds and purchase price.

Wait—is the additional financing boot? Boot analysis: relinquished property debt relieved = $0. Replacement property debt assumed = $100,000. When debt assumed exceeds debt relieved, the excess reduces the cash the investor must add but is not itself treated as boot received. No boot is received; the investor simply needs to add $100,000 cash (or via mortgage) to make up the price difference.

Recognized gain (Line 21): $0 (no boot received).

Deferred gain (Line 24): $185,600.

Basis of replacement property (Line 25): $500,000 FMV − $185,600 deferred gain = $314,400.

Going forward, the investor depreciates the replacement triplex starting from the $314,400 adjusted basis. Land is allocated first—assume $80,000 for land—leaving $234,400 of depreciable building. Annual MACRS depreciation = $234,400 ÷ 27.5 = $8,524 per year.

Planning Tip Your qualified intermediary's closing statement contains most of the numbers you need for Form 8824—the sales price, exchange funds wired, and purchase price. Give this document to your CPA along with the original purchase documents for both properties, any HUD-1 or closing disclosure statements, and your depreciation schedule for the relinquished property. Having these organized before tax season saves time and reduces the risk of errors on the form.

Two-year exchange: when the sale and purchase straddle year-end

If your relinquished property closes in one calendar year and your replacement property does not close until the following year, you have a two-year (straddle-year) exchange. This is common when investors sell in November or December and take advantage of the full 180-day period, closing on the replacement in May or June of the following year.

For a straddle-year exchange, you file Form 8824 in both years:

In the first year (year of relinquished property sale), you file Form 8824 to report the incomplete exchange. The form indicates that you intend to complete the exchange in the following year and no gain is recognized yet.

In the second year (year of replacement property closing), you file Form 8824 again to complete the reporting—showing the replacement property received, calculating the deferred gain, and establishing the new basis. The form instructions provide specific line-by-line guidance for two-year exchanges.

An important note: while an extension to file your tax return gives you more time to submit Form 8824, it does not extend the 45-day or 180-day exchange deadlines. Those deadlines run from the actual sale date regardless of your filing extension.

What happens if you do not file Form 8824

Failing to file Form 8824 does not automatically void an otherwise valid exchange, but it creates significant tax risk. Without Form 8824, the IRS sees a real property sale with no corresponding gain reported and no Form 4797 reporting. This inconsistency may trigger an inquiry or audit.

The IRS also receives Form 1099-S (Proceeds From Real Estate Transactions) from the title company when your relinquished property closes, showing the gross sales price. If your return does not reconcile this income by filing Form 8824 to show the exchange deferral, the mismatch may generate a CP2000 notice asserting additional tax on unreported income.

If you missed filing Form 8824 for a past exchange, consult a tax professional about amending the affected return. In some cases, a late or amended Form 8824 can still properly document the exchange and avoid penalties, though the facts and timing matter.

Frequently asked questions

What form do you file for a 1031 exchange?

You file IRS Form 8824 (Like-Kind Exchanges) with your federal income tax return for the year in which the relinquished property was sold. If the exchange spans two calendar years, you file Form 8824 in both years—once for the incomplete exchange and once after the replacement property closes.

What is the deadline to file Form 8824?

Form 8824 is filed with your federal income tax return, due by April 15 or October 15 if you file an extension. Note that filing an extension does not extend the 180-day exchange deadline, which is based on the actual closing date of the relinquished property, not the tax filing deadline.

What happens if you don't file Form 8824?

Failing to file Form 8824 does not automatically disqualify a valid exchange, but it leaves an unexplained real estate sale on your return. The IRS may treat the transaction as fully taxable. Your CPA should always file Form 8824 for any completed 1031 exchange to report the deferred gain and establish the replacement property basis.

What is the basis in the replacement property after a 1031 exchange?

The replacement property's adjusted basis equals its fair market value minus the deferred gain (Form 8824 line 25). This lower basis ensures the deferred gain will eventually be recognized. It is also the starting point for future depreciation calculations on the replacement property.

Educational information and estimates only. Not tax advice. Tax rules change and vary by situation; consult a qualified tax professional before acting.