Inputs to organize
- Money received
- Non-like-kind property
- Liabilities relieved
- Liabilities assumed
- Additional cash paid
- Realized gain inputs
What the worksheet shows
- Estimated net boot
- Recognized-gain ceiling
- Items requiring Form 8824 review
How the model works
List money received outside the qualified exchange and the fair market value of non-like-kind property received.
List liabilities from which the taxpayer is relieved and liabilities assumed on replacement property.
Show additional cash paid and other permitted offsets separately instead of netting all entries invisibly.
Estimate net potential boot from the entered cash, property, and liability components.
Limit the displayed recognized-gain estimate to the lesser of entered realized gain and estimated net boot, subject to professional review.
Checks before relying on the output
- Require fair-market-value inputs for non-like-kind property.
- Do not allow recognized gain to exceed entered realized gain.
- Warn when liability entries are incomplete or do not match closing statements.
- Keep transaction costs outside the boot formula until classified by the tax adviser.
Boot and recognized gain can be affected by transaction costs, liability treatment, basis, depreciation, and other facts.
Common questions
Is every dollar left over after closing boot?
Not automatically. The source, recipient, timing, and classification of the amount matter, and the qualified intermediary's records should reconcile with both closing statements.
Can replacing debt with cash reduce mortgage-boot exposure?
Additional cash can affect the liability comparison, but the complete exchange must be modeled. The estimator should display the inputs rather than promise a result.
Why is recognized gain capped at realized gain?
Receipt of boot generally causes recognition only up to the gain realized in the transaction. The tool still cannot determine final character or tax.
Are closing costs included?
Some exchange expenses affect amount realized or basis, while other costs may not. The tool should hold them in a review category until properly classified.
Does zero estimated boot guarantee full deferral?
No. Ownership, property use, intermediary structure, timing, identification, related parties, and other requirements can still affect qualification.
