So, shouldn't he get to recover the basis tax free? I think that's where I'm getting hung up. Seems like if the value of the received property qualifies as a partial 1031, the $284,600 shouldn't be taxed and the remaining basis of the original property shouldn't be taxed, leaving a total of about $129k capital gains taxed. The system is showing me $413,601 as capital gains taxable (sold property value minus sold property basis).

Thanks for the help!