Capital gains on a 1031 Property

[Jim Cummings]

For 1031 Experts:

Sold one (1) property via 1031 Exchange in 2016. Rolled the  Monies over and purchased two (2) Properties on 1031 Exchange, in 2016. 

IF I just SELL ONE (1) of the properties in 2023 or subsequent years, am I liable for Cap Gains taxes on all the 1031 Money  carried forward or is it prorated based on Monies Invested into the property at time of purchase or what other guidelines should I be cognizant of?  

Appreciate your help.

[Dave Foster]

Hi @Jim Cummings.  Hope you're enjoying those properties.  When you purchased the two replacements your accountant allocated the basis of your old property into both of them.  So each of the replacements had some of the basis transfer over.  This of course means that some of the profit went to each property as well.  

If you sell one of them you'll only pay the tax on the gain from the sale of that one (unless you 1031 again of course)