Enter your sale details. See deferred gain, taxable boot, and cash available for the next property.
Educational estimate using common 2026 rates. Not tax advice.
The calculator starts with your gain realized (sale price minus selling costs and adjusted basis), then calculates any boot: cash you keep or net mortgage relief. Boot is taxable up to the amount of your gain; everything else defers. Recognized gain splits into depreciation recapture, taxed at 25% under Section 1250, and the remaining capital gain, taxed at up to 23.8% with NIIT.
Run the timeline, model boot, and calculate what you would owe without the exchange.
Sell investment real estate the ordinary way and you owe capital gains tax on every dollar of profit, plus a 25% recapture tax on the depreciation you wrote off over the years. A 1031 exchange, named for the section of the Internal Revenue Code that allows it, lets you roll all of that into a new like-kind property and owe nothing at closing. The gain does not disappear. It carries forward in the replacement property's adjusted basis, waiting for a sale that never happens (at best) or happens decades later.
Say you sell for $500,000 with a $300,000 basis and $30,000 in closing costs, producing a $170,000 gain. Buy a replacement worth at least as much and carry at least as much debt, and boot is zero. The entire gain defers, and you reinvest the full net proceeds. Buy something cheaper, or pocket any cash, and the shortfall is "boot," which this calculator isolates and prices.
The 45/180-day timeline calculator maps your deadlines from any closing date. The capital gains calculator shows what you would owe without the exchange.
Cash you receive from the sale, or a reduction in mortgage debt not offset by additional cash into the replacement. Boot is taxable up to the amount of your gain.
Yes. In a fully deferred exchange, depreciation recapture defers along with the capital gain. It becomes taxable only to the extent of recognized gain, which is the boot amount.
Depreciation recapture on real estate is taxed at up to 25% under Section 1250. The remaining long-term capital gain is taxed at up to 20%, plus 3.8% NIIT for higher earners, for a combined maximum of 23.8%.
To defer the full gain, your replacement property's value and debt should equal or exceed what you gave up on the sale. Any shortfall is boot.
No. It is an educational estimate. Work with a qualified intermediary and a tax professional.