Like-kind exchange an Automobile

This document covers the like-kind exchange process for automobile assets using property type A or T for exchanges occurring after 2017. Beginning in 2018, tax-deferred like-kind exchanges only apply to real property and no longer apply to automobiles or other personal property.

Dispose of the original vehicle and add the vehicle received in the exchange:

1. From the Asset Detail view: Select Dispose an Asset. Enter the Disposal Date. Select Taxable Exchange as Disposal Method, enter the trade-in allowance towards the new vehicle as Non-Cash proceeds.
2. Create an asset for the new Luxury Auto: Select Property Type A (or T) and use the actual date of the exchange for the Placed-in-Service Date. Enter the sum of the trade-in value (the Non-Cash Proceeds on the disposal) plus the boot (Cash Paid) for the Acquisition Value. Leave Purchase selected in the Acquired by section.
   Note: There’s no need to enter any data in the Beginning Depreciation fields. You don't need to select Exchange or Conversion.

For more information, see the Help topic: Luxury Vehicles and Like-Kind Exchanges.