Cost basis and deferred gain for "3rd" 1031 exchange

[Rodolfo Ham-Zhu]

  Hi All, 

  I have a question about Withholding Statements in the context of 1031 exchanges. I am in the process of exchanging out of my "2nd property" (just sold), into my "3rd property".

  Suppose the following scenario: 

  1st property

  Purchased for 100k 

  Sold for 200k

  Cost basis would be 100k (making it simple to not count for depreciation, etc).

  Deferred gain would be 100k   

  2nd property (acquired through 1031 exchange)

  Purchase for 200k

  Sold for 400k

  When filling up do Real Estate Withholding Statement (California From 593)

  Is the cost basis 200k OR the 100k from the "original" property

  Is the deferred gain the 200k (the difference between 400k-200k) or 300k (accounting for 2nd property AND "original" gain, that is 400k-100k)

  Any insight would be very helpful. Thanks!