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1031 Exchange Calculator

Tax-deferred exchange analysis for real estate investors

▼ Relinquished Property (Selling)

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$
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$

▲ Replacement Property (Buying)

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$
$

◆ Tax Information

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Exchange Analysis

Tax Savings from Exchange $0
Realized Gain $0
Recognized Gain (Boot) $0
Cash Boot $0
Mortgage Boot $0
Total Boot $0
Deferred Gain $0
Net Equity from Sale $0
Equity Required in Replacement $0
New Basis in Replacement Property $0

Compare the financial impact of a full 1031 exchange, a partial exchange, and selling outright without deferral.

Best Option

Full 1031 Exchange

Reinvest all proceeds into like-kind replacement property

Tax Owed $0
Deferred Gain $0
Net Proceeds $0
Equity Available $0

Partial Exchange

Current inputs: some boot received, partial tax deferral

Tax Owed $0
Deferred Gain $0
Net Proceeds $0
Boot Received $0

No Exchange (Sell & Pay Tax)

Sell outright and pay full capital gains tax

Tax Owed $0
Deferred Gain $0
Net Proceeds $0
Tax Savings Lost $0

How to Use This Calculator

1
Enter Relinquished Property Details

Input the selling price, your adjusted basis (purchase price plus improvements minus depreciation), selling costs, and existing mortgage balance.

2
Enter Replacement Property Details

Provide the purchase price for the new property, the new mortgage amount, and estimated closing costs.

3
Set Your Tax Rates

Adjust capital gains rate, state tax rate, depreciation recapture rate, and indicate whether NIIT applies to your income level.

4
Review Exchange Analysis

See your realized gain, boot amounts (cash and mortgage), deferred gain, tax savings, and the new basis in your replacement property.

5
Compare Scenarios

Switch to the Scenario Analysis tab to compare a full exchange, partial exchange, and selling outright to understand the total tax impact.

Frequently Asked Questions

What is a 1031 Exchange and who qualifies?

A 1031 exchange, named after Section 1031 of the Internal Revenue Code, allows investors to defer capital gains taxes when selling an investment property by reinvesting the proceeds into a like-kind replacement property. It applies to investment and business real estate, not personal residences. Both individuals and entities (LLCs, partnerships, trusts) can participate.

What are the key deadlines for a 1031 Exchange?

There are two critical deadlines: (1) The 45-day identification period, during which you must formally identify up to three potential replacement properties, and (2) the 180-day exchange period, by which you must close on the replacement property. Both begin on the date of sale and are calendar days with no extensions.

What is "boot" and how does it affect my taxes?

Boot is any value received in the exchange that is not like-kind property. Cash boot occurs when you receive cash from the sale that is not reinvested. Mortgage boot occurs when your new mortgage is less than your old mortgage, effectively reducing your debt. Both types of boot are taxable up to the amount of your realized gain.

Can I exchange into multiple replacement properties?

Yes. Under the three-property rule, you can identify up to three replacement properties regardless of value. Alternatively, the 200% rule allows identification of any number of properties as long as their combined value does not exceed 200% of the relinquished property's sale price.

What happens to the basis of my replacement property?

Your new basis equals the replacement property's purchase price minus any deferred gain carried over from the exchange. This lower basis means less depreciation deduction annually and a larger taxable gain if you eventually sell without doing another exchange. The deferred tax is not eliminated, just postponed.

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