For taxpayers affected by the California wildfires, the aftermath may cause significant disruption in their ability to monitor and complete transactions that were in process at the time of the disaster.
For taxpayers that were in the midst of a like-kind exchange transaction under section 1031, the failure to complete the exchange within the specific time requirements of section 1031 would typically result in the recognition of gain that the taxpayer originally intended to defer. The IRS has granted “affected taxpayers” with respect to these wildfires an extension of time to perform certain actions.
This report explains how taxpayers—including those located outside the specific covered disaster area—affected by the disaster may qualify for this rare extension of time.
Read a November 2018 report [PDF 85 KB] prepared by KPMG LLP: What’s News in Tax: California Wildfires: Like-Kind Exchange Relief for Affected Taxpayers in California and Beyond
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