1031 exchange savings calculator
Find the approximate net savings from choosing to exchange with 1031X. Enter your figures in the fields below.
ADJUSTED TAX BASIS
For your relinquished property
Original purchase price
Add any capital improvements
Subtract your accumulated depreciation
Adjusted Tax Basis
LONG-TERM CAPITAL GAIN
Based on your upcoming sale
Contract sales price
Subtract your closing costs
Subtract your adjusted basis
Long-term Capital Gain
POTENTIAL TAXES OWED
If you do not 1031 exchange
Federal capital gain tax (20% bracket)
Federal capital gain tax (15% bracket)
Your state for income tax
State capital gain tax
Depreciation recapture tax (25%)
Medicare surcharge (§1411) tax
Potential Taxes Owed
PROCEEDS AVAILABLE - NO 1031
Money left over after Uncle Sam
Net sales price
Subtract all debt payoff
Subtract taxes due
PROCEEDS AVAILABLE - 1031 EXCHANGE
Money left over w/ 1031X
Net sales price
Subtract all debt payoff
Subtract the 1031X fee
When you’re trying to figure capital gains on real estate, a calculator like ours makes your job easy. Even better, our calculator can show you the benefits of a 1031 exchange — you’ll immediately see the difference in available capital with or without one. Try our simple property sale tax calculator below to find whether a 1031 exchange makes sense for you.
Adjusted tax basis
When you sell a property, the IRS wants to tax the profit you made. Your “profit” is equal to the difference between what the property cost you and how much you sell it for. However, in the eyes of the IRS, the “cost” of your existing property will change over time. This moving figure is known as the adjusted tax basis. Each year, depreciation will reduce the cost of your property (and increase your taxable profit upon sale). Any improvements you put toward property will increase the cost of your property (and reduce your taxable profit upon sale).
Long-term capital gain
Your long-term capital gain is the amount of profit you realize following the sale of a property you have held for longer than 12 months. Take the sale price of your property, then subtract closing costs and your adjusted tax basis to determine how much you’re truly gaining from the sale. Outside of a 1031 exchange, this is the number that the IRS will use to apply long-term capital gains tax.
Potential taxes owed
If you sell your property without completing a 1031 exchange, this calculation shows how much you would pay in taxes. Sometimes, we don’t know the benefits of a 1031 exchange until we see an estimate of total capital gains tax owed. What’s your final calculation? This will help you determine if a 1031 exchange is worthwhile.
Proceeds available — no 1031
After you pay your taxes, this calculation shows how much you walk away with following the sale of your property and debt payoff. Is this about what you expected?
One of the biggest benefits of a 1031 exchange is having full access to the profit you earn from a sale to put toward your next investment. If you make a significant profit on a sale, doing a 1031 exchange gives you access to more, larger, and more valuable future real estate investments.
Proceeds available — 1031 exchange
Here, you can see that, without taxes, you can experience a significant increase in available proceeds from your sale. Remember, the real value this represents is that you can now place the full power of your appreciated real estate toward generating more future earnings. You can do this through a larger portfolio, or the ability to charge higher rent prices, or simply by reinvesting in areas with higher growth potential.
The capital gain tax formula provided is to help you determine an approximate gain and amounts that may be deferred under Internal Revenue Code §1031. 1031X.com, Inc., its officers or employees are not authorized or permitted under applicable laws to provide tax or legal advice to any client or prospective client of 1031X.com, Inc. The tax-related information contained herein or in any other communication that you may have with a representative of 1031X.com, Inc. should not be construed as tax or legal advice specific to your situation and should not be relied upon in making any business, legal or tax-related decision. A proper evaluation of the benefits and risks associated with a particular transaction or tax return position often requires advice from a competent tax and/or legal advisor familiar with your specific transaction, objectives and the relevant facts. We strongly urge you to involve your tax and/or legal advisor (or to seek such advice) in any significant real estate or business-related transaction.