Free CPE for CPAs: §453, 1031 boot and the passive losses stuck on your client's return
Two 50-minute programs in one live webinar for CPAs whose clients sell rental real estate or a closely held business. Program A: Section 453 on its own or with a 1031: structuring the boot. Program B: Understanding passive losses: what's stuck, what frees it, and what disappears. Worked cases with sourced numbers, Form 6252 and Form 8582, polls and a knowledge check.
Straight answer on credit: this course is not NASBA-registered. California CPAs may self-claim the hours under the CBA rules; some other boards will not accept it. Details below.
Who it's for
CPAs first, plus enrolled agents and tax advisors whose clients own rental real estate or a closely held business and will sell it, exchange it, or carry suspended passive losses into the sale. Intermediate level; working knowledge of individual income tax, capital gains and depreciation assumed. No advance preparation.
The session: 100 minutes of instruction
| 12:00 to 12:50 PM PT | Program A (50 minutes): Section 453 on its own or with a 1031: structuring the boot |
| 12:50 to 1:00 PM PT | Break (10 minutes, not counted) |
| 1:00 to 1:50 PM PT | Program B (50 minutes): Understanding passive losses: what's stuck, what frees it, and what disappears |
Program A learning objectives
On completion, participants will be able to:
- Compute the gross profit ratio and recognized gain per payment on Form 6252, and identify the gain §453(i) forces into the year of sale.
- Classify each type of 1031 boot (cash, released exchange funds, mortgage boot, personal property, notes) and net liabilities under Reg. §1.1031(d)-2.
- Explain how installment boot is reported under §453(f)(6) and list the three drafting conditions that keep a structured boot carve-out from breaking the exchange.
- Evaluate a trade-down (book Case 4) three ways, full 1031, cash boot, structured boot, and name four facts that make §453 the wrong tool.
Program B learning objectives
On completion, participants will be able to:
- Determine whether a client's rental losses are passive, allowed under the $25,000 allowance, or nonpassive under the §469(c)(7) real estate professional rules.
- Locate suspended losses on Form 8582 (Part VII, column (c)) and FTB 3801, and compute the release on a fully taxable sale and on an installment sale using the Form 8582 ordering.
- Identify which exits free suspended losses (§469(g)(1)(A)), which keep them locked (a 1031, except boot), and which erase them (death, §469(g)(2)).
- Compute the net gain ratio against the gross profit ratio for a seller with suspended losses, and state when spreading the gain adds value and when it does not.
Agenda (100 minutes of instruction)
| Program A, 12:00 to 12:50 PM PT (50 minutes): Section 453 on its own or with a 1031: structuring the boot | |
| 0 to 3 min | Welcome, disclosure (licensed producer; commission about 2.4% of any amount structured, paid by the insurer), learning objectives. |
| 3 to 6 min | The one question: the last day a seller can choose installment treatment, and why the exchange version comes even earlier. Poll 1. |
| 6 to 12 min | Installment method: §453(a), (b)(1) default, §453(d) election out, exclusions (dealer, publicly traded, §453(g)), §453(e), interest under §483/§1274. Gross profit ratio and Form 6252, worked on a $1.1M sale, straight-line vs cost-seg heavy. |
| 12 to 17 min | The three layers: §1245 recapture at disposition (§453(i)), unrecaptured §1250 reported first (Reg. §1.453-12), long-term gain. §453A interest charge computed on an $8M note; §453A(d) pledging; farm exception. |
| 17 to 25 min | Seller financing vs the structured installment sale: four ways to lose the deferral; the six-step mechanics; the honest open question (Temp. Reg. §15a.453-1(b)(3)(i), CCA 202118016, Wynne, Cunningham) and three safeguards; how it differs from a monetized installment sale (REG-109348-22). Poll 2. |
| 25 to 31 min | 1031 boot, every kind; mortgage boot netting under Reg. §1.1031(d)-2 on a $2M sale with a loan paid off; the free-and-clear sale. |
| 31 to 36 min | Combining a 1031 with an installment sale: §453(f)(6), the carve-out at closing, the (g)(6) safe harbor, why (j)(2)(iii) does not reach an assignment company's obligation; §453 as the 1031 backup and the dual-track contract. |
| 36 to 43 min | Case walk-through (book Case 4): $3M trade-down, $1.08M of unavoidable boot structured over 7 years; three ways after 10 years; the bigger-building crossover. Poll 3. |
| 43 to 45 min | When §453 is the wrong tool. |
| 45 to 48 min | Knowledge check (5 questions, run as polls). |
| 48 to 50 min | Close, Q&A, evaluation. |
| 50 to 60 min | Break, 12:50 to 1:00 PM PT (10 minutes, not counted toward CE) |
| Program B, 1:00 to 1:50 PM PT (50 minutes): Understanding passive losses: what's stuck, what frees it, and what disappears | |
| 60 to 63 min | Welcome, disclosure, learning objectives. |
| 63 to 65 min | The number almost nobody checks: Form 8582 Part VII column (c) and FTB 3801. Poll 1. |
| 65 to 74 min | §469 basics and the order of limits (§704(d), §465, §469, §461(l)); the $25,000 allowance and its phase-out (§469(i)); real estate professional and material participation (§469(c)(7); Reg. §1.469-9), with cases. |
| 74 to 79 min | Three exits: death, fully taxable sale, 1031. The rate swap worked: $200,000 gain, $200,000 of suspended losses, $300,000 wages, Texas vs California. |
| 79 to 83 min | Installment sales: §469(g)(3) and the Form 8582 ordering (own gain first, overall loss in the ratio of gain recognized to gain not yet recognized). Poll 2. |
| 83 to 90 min | Death (§469(g)(2)) and what disappears; a 1031 keeps losses locked except boot (JCS-10-87; Temp. Reg. §1.469-2T(c)(2)(i)(A)); California: FTB 3801, no REP (R&TC §17561(a)), no bonus, no rate swap. |
| 90 to 100 min | Net gain ratio vs gross profit ratio; perfect world vs reality; the worked $1.1M example four ways (cash, structured, 1031 with cash boot, 1031 with structured boot). Poll 3. |
| 100 to 105 min | The downsides, honestly; the Monday-morning file review. |
| 105 to 108 min | Knowledge check (5 questions, run as polls). |
| 108 to 110 min | Close, Q&A, evaluation. |
CPE credit: the honest version
CPAs: CPE credit
This course is not registered with NASBA's National Registry of CPE Sponsors, and the instructor is not a state-board-registered CPE sponsor. Whether it counts depends on your state board:
- California: the CBA does not pre-approve providers. You may claim the hours (up to 2: one for each program) if the program meets CBA standards (16 CCR §88 to 88.2: formal program, qualified instructor, technical subject in taxation, 50-minute hours). We supply the outline, learning objectives, attendance record and a certificate that carries every field the regulation names; you self-certify at renewal and keep the paper.
- Other states: several boards accept only NASBA-Registry or board-registered sponsors (Texas, Illinois, New Jersey, Pennsylvania and Ohio among them). If yours does, this session will not count toward your CPE. Attend for the content, not the credit. Check your board before you rely on it.
Enrolled agents & AFSP participants (same session, CE page)
An IRS continuing education provider application is pending (filed September 13, 2026, confirmation 27783547). It covers Program A only. IRS CE credit for EAs and AFSP participants can only be issued once the IRS approves the provider and assigns a program number. If that happens before November 18, Program A carries 1 hour of IRS credit and your certificate will show the program number. If it has not happened, no IRS credit is issued for the session, and you'll be told so plainly. Program B will be registered with the IRS separately after approval, so it carries no IRS credit on November 18. No one will be told "it counts" before it does.
Certificates go out within 48 hours of the session. Attendance is monitored (login/logout and three polling questions per 50-minute program) because that is what makes the hours defensible in an audit.
Your instructor
Hans Goldstein runs Hans Goldstein: Tax & Exit Planning in Los Angeles, California. He is an Enrolled Agent, admitted to practice before the Internal Revenue Service. His practice centers on the tax side of selling appreciated real estate and closely held businesses: installment sales under §453, 1031 exchanges that leave boot, and the suspended passive losses already sitting on the seller's return. He is the author of The Waterfall Strategy and publishes the §453 calculator and methodology at installmentsalecalculator.com, written so an EA or CPA can reproduce every figure.
Questions
Is this free CPE for CPAs?
The session is free: no fee, no product. Whether the hours count as CPE depends on your state board. The course is not registered with NASBA's National Registry of CPE Sponsors.
Does it count for California CPAs?
The California Board of Accountancy does not pre-approve providers. You may claim up to 2 hours (one per 50-minute program) if the program meets CBA standards in 16 CCR §88 to 88.2. We supply the outline, objectives, attendance record and a certificate; you self-certify at renewal and keep the paper.
Does it count in other states?
Several boards accept only NASBA-Registry or board-registered sponsors (Texas, Illinois, New Jersey, Pennsylvania and Ohio among them). If yours does, this session will not count toward your CPE. Check your board before you rely on it.
What is the field of study and level?
Taxation, technical. Intermediate level; working knowledge of individual income tax, capital gains and depreciation assumed. No advance preparation.
Is there IRS CE credit for enrolled agents?
Not yet. An IRS continuing education provider application is pending (filed September 13, 2026, confirmation 27783547) and covers Program A only. Credit can be issued only after approval and a program number. Enrolled agents and AFSP participants can see the details on the CE page.
How do I get the certificate?
Register here and on Zoom, attend live, and answer the polls. Certificates go out within 48 hours of the session.
Why is it free?
No fee, no product. The instructor's business is the tax analysis and structuring of installment sales; the session exists so that the practitioners who see sellers before contract know what to look for.
What do I get?
The slide deck with source notes for both programs, the knowledge-check sheet, the practitioner Q&A handout, and your certificate.
Can I attend only one program?
Yes. Each program stands on its own; CE hours follow the time you're logged in and the polls you answer in that program.
I can't make the date.
Register anyway and pick "Next session (notify me)".
Can I bring a client question?
Yes. Each program ends with Q&A; bring the fact pattern.