Seller of Property ‘A’ received a down payment of $500,000 – after expenses of the sale, the Intermediary received approximately $267,250. After their fee of $1,250 - $266,000 was given to the seller of Property ‘B’ at the closing for the rental property identified and purchased by the seller of ‘A’.

Seller A purchased the property ‘B’ for $356,000. At the closing, seller ‘A’ added $90,000.00 in cash to make the purchase. Are you saying that the property purchased for $356,000.00 which is more than the $267,000.00 left after expenses of the sale e.g. transfer taxes, etc., is a failed 1031 exchange because the $356K does not exceed the gross down payment of $550K?

Client no longer had depreciation on the building Property ‘A’, but only the remainder of depreciation for appliances and apt renovations that had not as yet completed their term of depreciation allowed sjrcpa. No depreciation was yet taken on this year’s return. The AMT report in the program shows depreciation remaining that has not been taken.

Thank you for your response and help sjrcpa. Your knowledge and experience are a blessing.

Robert