Fill Form 4797 Theyre 2022-2023

Instructions and Help about Fill Form 4797 Theyre

Welcome to 10:31 University I'm Paul Holloway today we are going to discuss the identification process under 1031 of the tax code and specifically the three sub rules under the identification process which are referred to as the two hundred percent rule the 95 percent rule and the easiest of the three the three property rule so what we are dealing with for those of you who are beginning on 1031 is once you sell an investment property the IRS gives you 45 days to identify up to three potential replacement properties commonly referred to as the three property rule so if you send in your identification list to your intermediary and you keep the list at three properties or less there is no regard to fair market value each property could be worth ten trillion dollars it doesn't matter to the IRS but what if you cannot keep your identification list to three properties or less what if you need to identify four or five six or 50 properties you can do that but then you have to follow another sub rule under the identification process commonly referred to as the two hundred percent rule so let's assume a taxpayer wants to go ahead and identify four properties they cannot limit the list to just three they want to put down for potential so what the taxpayer will have to do is first of all know what they sold their front end property for let's just say they sold for $400,000 to put a number on it and if they identify four properties they'll have to assign a fair market value to each one of those properties let's assume that the value is one hundred thousand each just to put a number on it so under the two hundred...