Calculate basis in a 1031 exchange
I've seen a few different articles online about this with conflicting calculations but basically what is my basis for this 1031 exchange here:
-Bought a house for 63,240 paid in cash.
-Sold for 150K.
-After expenses my cash walking away from deal was 137K.
-I bought two new houses with the proceeds. One for 350K and another for 310K, 25% down each.
-I had to add about 28K cash to the deal for down payments on the two houses.
-Financing costs were about 10K approximately.
-Selling costs for the property were about 10K.
-I took 9K in depreciation.
I came up with 554,240 as my basis between the two replacement properties. Is this accurate?
I took the 63,240
subtracted 9K depreciation
subtracted 20K purchase and sale fees
added cash of 28K
added the 262K and 230K mortgages after down payment.
Per this example: https://apiexchange.com/replacement-property-calculation/
Taxpayer exchanges a relinquished property with a value of $1,000,000, mortgage of $500,000 and a basis of $500,000 for a replacement property with a value of $1,500,000, a mortgage of $900,000 and the taxpayer adds cash of $100,000. The basis is computed as follows:
| Basis of Relinquished Property | $500,000 | |
| Plus: Liabilities Assumed by Taxpayer | + | $900,000 |
| Plus: Amount of Cash Paid | + | $100,000 |
| Less: Liabilities Assumed by Buyer | – | $500,000 |
| Equals: Basis in Replacement Property | = | $1,000,000 |