Like-Kind Exchange: Pre-1/3/2000

Note: This Disposal Method is available as a disposal option if the disposal date is before 1/3/2000. See Like-Kind Exchanges and Involuntary Conversions Overview for exchanges after 1/2/2000.

A like-kind exchange occurs when you exchange an asset for a similar asset, such as exchanging an old car for a new one. The exchange can also include the receipt of money or dissimilar property. Any resulting gain from a like-kind exchange is recognized only to the extent of cash proceeds (sometimes called "boot"). Any resulting loss should be recognized for tax purposes.

In 2000, the IRS issued new guidelines concerning property received in a like-kind exchange. Use this disposal method for a like-kind exchange that occurred before 1/3/2000, and therefore does not require the use of the new guidelines.