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Section 1043

additional depreciation if you had sold the

3. Report the amount from line 35 on

property (see the Form 4797 instructions

Form 4797, line 10, column (g). In column

Conflict-of-Interest Sales

for line 26), or

(a), write “From Form 8824, line 35.” Don't

(Part IV)

complete columns (b) through (f).

2. The larger of:

If you sell property at a gain according to a

a. The gain shown on line 20, if any,

Line 36. If you sold a capital asset, enter

certificate of divestiture issued by the

any capital gain from line 36 on your

Office of Government Ethics (OGE) or the

b. The excess, if any, of the gain in

Schedule D. If you sold property used in a

Judicial Conference of the United States

item (1) above over the FMV of the section

trade or business (or any other asset for

(or its designee) and purchase

1250 property received.

which the gain is treated as ordinary

replacement property (permitted

income), report the gain on Form 4797,

property), you can elect to defer part or all

Section 1252, 1254, and 1255

line 2 or line 10, column (g). In column (a),

of the realized gain. You must recognize

property. The rules for these types of

write “From Form 8824, line 36.” Don't

gain on the sale only to the extent that the

property are similar to those for section

complete columns (b) through (f).

amount realized on the sale is more than

1245 property. See Regulations sections

the cost of replacement property

1.1252-2(d) and 1.1254-2(d) and

Paperwork Reduction Act Notice. We

purchased within 60 days after the sale.

Temporary Regulations section

ask for the information on this form to carry

(You also must recognize any ordinary

16A.1255-2(c) for details. If the installment

out the Internal Revenue laws of the

income recapture.) Permitted property is

method applies to this exchange:

United States. You are required to give us

any obligation of the United States or any

1. See section 453(f)(6) to determine

the information. We need it to ensure that

diversified investment fund approved by

the installment sale income taxable for this

you are complying with these laws and to

the OGE.

year and report it on Form 6252.

allow us to figure and collect the right

If the property you sold was stock

amount of tax.

2. Enter on Form 6252, line 25 or 36,

you acquired by exercising a

the section 1252, 1254, or 1255 recapture

TIP

You are not required to provide the

statutory stock option, you may be

amount you figured on Form 8824, line 21.

information requested on a form that is

treated as meeting the holding periods

Don't enter more than the amount shown

subject to the Paperwork Reduction Act

that apply to such stock, regardless of how

on Form 6252, line 24 or 35.

unless the form displays a valid OMB

long you actually held the stock. This may

3. Also enter this amount on Form

control number. Books or records relating

benefit you if you don't defer your entire

4797, line 15.

to a form or its instructions must be

gain, because it may allow you to treat the

retained as long as their contents may

4. If all the ordinary income isn't

gain as a capital gain instead of ordinary

become material in the administration of

recaptured this year, report in future years

income. For details, see section 421(d) or

any Internal Revenue law. Generally, tax

on Form 6252 the ordinary income up to

Pub. 525, Taxable and Nontaxable

returns and return information are

the taxable installment sale income, until it

Income.

confidential, as required by section 6103.

is all reported.

Complete Part IV of Form 8824 only if

The time needed to complete and file

Line 22. Report a gain from the exchange

the cost of the replacement property is

this form will vary depending on individual

of property used in a trade or business

more than the basis of the divested

circumstances. The estimated burden for

(and other noncapital assets) on Form

property and you elect to defer the gain.

individual taxpayers filing this form is

4797, line 5 or line 16. Report a gain from

Otherwise, report the sale on your

approved under OMB control number

the exchange of capital assets according

Schedule D or Form 4797, whichever

1545-0074 and is included in the

to the Schedule D instructions for your

applies.

estimates shown in the instructions for

return. Be sure to use the date of the

their individual income tax return. The

Your basis in the replacement property

exchange as the date for reporting the

estimated burden for all other taxpayers

is reduced by the amount of the deferred

gain. If the installment method applies to

who file this form is shown below.

gain. If you made more than one purchase

this exchange, see section 453(f)(6) to

of replacement property, reduce your

determine the installment sale income

basis in the replacement property in the

taxable for this year and report it on Form

Recordkeeping

10 hr., 16 min.

. . . .

order you acquired it.

6252.

Learning about

Line 30. Enter the amount you received

the law or the

Line 24. If line 19 is a loss, enter it on

from the sale of the divested property,

form

1 hr., 59 min.

line 24. Otherwise, subtract the amount on

. . . . . . . . . . . .

minus any selling expenses.

line 23 from the amount on line 19 and

Preparing the

enter the result. For exchanges with

form

2 hr., 14 min.

Line 35. Follow these steps to determine

. . . . . . . . . . . .

related parties, see the instructions for

the amount to enter.

Line

7, earlier.

1. Use Part III of Form 4797 as a

Line 25. The amount on line 25 is your

worksheet to figure ordinary income under

If you have comments concerning the

basis in the like-kind property you

the recapture rules.

accuracy of these time estimates or

received in the exchange. Your basis in

suggestions for making this form simpler,

2. Enter on Form 8824, line 35, the

other property received in the exchange, if

we would be happy to hear from you. See

amount from Form 4797, line 31. Don't

any, is its FMV.

the instructions for the tax return with

attach the Form 4797 used as a worksheet

which this form is filed.

to your return.

2016 Instructions for Form 8824

-4-

Instructions For Form 8824 - Like-Kind Exchanges (And Section 1043 Conflict-Of-Interest Sales) - 2016 Page 4

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