Yelano Inc. exchanged an old forklift used in its business for a new forklift. This exchange qualifies as a nontaxable like-kind exchange.

Question

Quizplus · Accepted Answer

The Tax Cuts and Jobs Act of 2017 changed the rules for like-kind exchanges. After December 31, 2017, like-kind exchanges are limited to real property that is not held primarily for sale. Therefore, an exchange of personal property, such as forklifts, no longer qualifies as a nontaxable like-kind exchange.