What should I expect to pay for CPA fees to handle my 1031 exchange tax return?

I've helped several clients through 1031 exchanges, and the CPA fees typically range from $1500-3500 depending on complexity. For your situation (duplex to small apartment building), you're looking at the middle-to-upper part of that range - probably around $2500-3000. The key is finding someone with specific 1031 exchange experience. This isn't something you want handled by a general tax preparer who might do one every few years. Ask potential CPAs how many 1031s they handle annually. If it's fewer than 10, keep looking. Also, don't just focus on the fee. A good CPA will help you identify depreciation strategies on the new property that can save you thousands over time. They should also help you properly track your basis from the old property to the new one, which is critical for future transactions.

After struggling with two different CPAs who gave me conflicting advice about my 1031 exchange last year, I finally discovered taxr.ai https://taxr.ai and it was a game-changer. I uploaded my exchange documents and got a detailed analysis showing exactly what forms needed to be filed and how the basis calculation worked. The system flagged several issues my previous CPA had missed about depreciation recapture that would have caused major problems. I actually ended up taking their report to a new CPA who charged me significantly less ($1,800) because most of the analysis work was already done. Saved me both money and stress!

Just wanted to update after trying taxr.ai for my 1031 exchange documentation. I was really impressed by how thorough it was! The system caught that I had mixed-use property issues that would affect my exchange calculation and generated a report explaining exactly how to handle the residential vs. commercial split. When I took the report to my CPA, he said it saved him at least 4-5 hours of analysis work. He charged me $1,950 instead of his usual $3,200 for 1031 clients. The documentation was so comprehensive that my qualified intermediary commented that it was some of the best-prepared paperwork they'd seen from a client.

If you're having trouble getting clear answers about your 1031 exchange from the IRS, you might want to try Claimyr https://claimyr.com - I was going in circles trying to get someone from the IRS to clarify how to handle my partial 1031 exchange where I was taking some cash out. After three hours on hold and getting disconnected twice, I was ready to scream. Used Claimyr and got connected to an actual IRS agent in 15 minutes who walked me through exactly how to report it on Form 8824. You can see how it works in this video: https://youtu.be/_kiP6q8DX5c - totally worth it for the time saved and getting an actual answer directly from the IRS that I could rely on.

I have to eat my words about Claimyr. After my skeptical comment, I decided to try it myself for a different tax issue (not a 1031 but a question about depreciation recapture which is related). I was connected to an IRS agent in about 20 minutes. The agent wasn't an expert on my specific issue, but they were able to transfer me to someone in the right department who actually was knowledgeable. Total time including the transfer was about 40 minutes, which is miraculous compared to my previous experiences. I'm still not sure I'd trust the IRS phone advice alone for something as complex as a 1031 exchange, but combining their input with a good CPA's guidance definitely helps. And saving hours of hold time made a huge difference in my stress level.

I paid $2,200 for my CPA to handle my 1031 exchange last year. This was for a straight swap of one rental house for another, values around $500k each. Pretty simple transaction with no boot or partial exchanges involved. One tip: ask if they charge a flat fee or hourly. I got burned on my previous exchange with hourly billing that ended up costing almost $4k because there were complications with the basis calculation from improvements I'd made.

Watch out for CPAs who try to upsell you on unnecessary services for 1031 exchanges. I was quoted $5,000 by one firm that tried to convince me I needed monthly consultations throughout the year following the exchange. Got a second opinion and ended up paying $1,750 for quality work without the extra fluff. The key documents are Form 8824 (Like-Kind Exchanges) and the depreciation schedules for the new property. Any CPA trying to make it sound more complicated than that is probably padding the bill.

Great question about CPA fees! I went through a 1031 exchange two years ago (sold a small office building for $950K, bought a retail strip center for $1.3M) and ended up paying $2,800 to my CPA. Here's what I learned the hard way: get quotes from at least 3 CPAs and make sure they break down exactly what's included. My first quote was $1,600 but turned out to be just for Form 8824 - didn't include the depreciation recapture calculations or the new property basis setup. The CPA I ultimately used gave me a comprehensive flat fee that covered everything through the first year's tax return. One red flag to watch for: if a CPA can't explain the difference between deferred gain and recognized gain in simple terms during your consultation, keep looking. You want someone who can walk you through the process, not just fill out forms. The peace of mind is worth paying a bit more for true expertise. Also, start interviewing CPAs now - the good ones book up during tax season and you don't want to be scrambling at the last minute with such an important transaction.

I just completed a 1031 exchange similar to yours (rental duplex to small apartment complex) and paid $2,400 to my CPA. The transaction involved selling for $820K and buying for $1.15M, so very close to your numbers. A few things I wish I'd known upfront: 1. Ask specifically about their experience with mixed-use properties if your apartment building has any commercial space - this can complicate the calculations significantly. 2. Make sure they understand depreciation recapture rules. My CPA caught that I could defer some recapture I didn't even realize I had from improvements made to the duplex over the years. 3. Get everything in writing about what happens if there are complications. My exchange got delayed by a week due to title issues, and some CPAs would have charged extra for the additional coordination required. The good news is that with your transaction size, you're definitely in the "standard complexity" range that most experienced 1031 CPAs handle regularly. Just make sure whoever you choose has done at least a few apartment building exchanges - the depreciation schedules can be more complex than single-family rentals. Best of luck with your exchange! The tax savings make it all worthwhile.

Based on everyone's experiences shared here, it sounds like $2,500-3,000 is a reasonable budget for your exchange complexity. I went through a similar situation last year (sold a triplex for $780K, bought a 12-unit apartment building for $1.4M) and ended up paying $2,650 to my CPA. One thing I'd add to the great advice already given: ask potential CPAs about their software and systems for tracking basis. My CPA uses specialized real estate tax software that generated detailed reports I could actually understand, showing exactly how my basis carried over and what my new depreciation schedules would look like. This documentation proved invaluable when I met with my financial advisor to plan future investment strategies. Also, don't forget to factor in the qualified intermediary fees (around $1,000-1,500) when budgeting your total professional service costs. The QI and CPA need to coordinate, so it's worth asking if your CPA has worked with your chosen QI before. The peace of mind from having an experienced 1031 specialist handle everything was worth every penny. Good luck with your exchange!

I recently completed a 1031 exchange and can share some insights on CPA costs and selection. For a transaction similar to yours (sold rental property for $900K, purchased small commercial building for $1.3M), I paid $2,750 to my CPA. Here's what I learned about choosing the right professional: **Key questions to ask potential CPAs:** - How many 1031 exchanges do you handle per year? (Look for 15+ annually) - Can you provide references from recent 1031 clients? - Do you use specialized real estate tax software? - What's included in your flat fee vs. what might incur additional charges? **Red flags to avoid:** - CPAs who seem unclear about depreciation recapture rules - Anyone who can't explain the boot calculation clearly - Firms that quote significantly below $2,000 (often means corners will be cut) **What should be included in the fee:** - Form 8824 preparation - Basis calculations and carryover documentation - New property depreciation schedule setup - Coordination with your qualified intermediary - First-year tax return preparation including the exchange The complexity of your duplex-to-apartment building transaction is pretty standard, so you shouldn't face any unusual surcharges. Just make sure to mention any mixed-use aspects upfront when getting quotes. One final tip: start your CPA search now. The experienced 1031 specialists get booked up quickly, especially during busy real estate seasons.