1031 Exchange Calculator
Calculate tax deferred in a 1031 exchange. See boot, depreciation recapture, and minimum replacement price.
Capital Gain
$200,000.00
Tax Deferred
$42,500.00
Boot
$0.00
1031 Exchange Analysis
| Sale Price | $500,000.00 |
| Adjusted Basis | $300,000.00 |
| Capital Gain | $200,000.00 |
| Capital Gains Tax (20%) | $30,000.00 |
| Depreciation Recapture (25%) | $12,500.00 |
| Total Tax Without 1031 | $42,500.00 |
| Replacement Property Price | $550,000.00 |
| Boot (Cash Not Reinvested) | $0.00 |
| Tax Deferred via 1031 Exchange | $42,500.00 |
Full tax deferral achieved. Your replacement property price meets or exceeds the sale price, so no boot is recognized.
A 1031 exchange defers capital gains tax on investment property by reinvesting proceeds into like-kind property. The exchange must be completed within 180 days, and a qualified intermediary is required.
Use the 1031 Exchange Calculator above to calculate your results. Enter your values and see instant results — all calculations run in your browser.
Disclaimer: This calculator is for informational purposes only and does not constitute tax, financial, or legal advice. Results are estimates based on the information you provide and current rates. Always consult a qualified tax professional or financial advisor for advice specific to your situation.
How It Works
A 1031 Exchange Calculator helps investors estimate the potential tax deferral benefits when exchanging one investment property for a like-kind property. It's crucial for understanding the financial implications and maximizing returns by delaying capital gains taxes.
The calculator determines the deferred capital gains by subtracting the adjusted basis of the relinquished property from its selling price, then factoring in any depreciation recapture. It also considers the purchase price of the replacement property and any cash received (boot) which may be taxable.
Always consult with a qualified tax advisor or accommodator before initiating a 1031 exchange to ensure compliance with IRS regulations. A common mistake is failing to identify replacement properties within the strict 45-day deadline or close within 180 days.
Example: Deferring Capital Gains on an Investment Property
- 1 You sold an investment property for $1,000,000. Your adjusted basis (original purchase price + improvements - depreciation) was $400,000. You are looking to purchase a replacement property for $1,200,000.
- 2 The calculator would determine your capital gain as $600,000 ($1,000,000 - $400,000). Since you are reinvesting all proceeds into a like-kind property of equal or greater value, the entire $600,000 in capital gains would be deferred.
- 3 Result: $600,000 in capital gains deferred. No immediate capital gains tax liability.
- 4 Takeaway: By utilizing a 1031 exchange, you avoid paying capital gains tax on the $600,000 profit from your relinquished property, allowing you to reinvest the full amount into your new property and continue to grow your real estate portfolio tax-efficiently.
Source: CFPB — Owning a Home · Last updated: April 2026
Frequently Asked Questions
What is a 1031 exchange?
How much tax does a 1031 exchange save?
Can I do a 1031 exchange on my primary residence?
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