1031 Exchange Calculator
See what a like-kind exchange defers, and where boot quietly makes part of it taxable.
What This Calculator Does
Compares selling outright against exchanging: it estimates the gain and depreciation recapture exposed in a straight sale, then shows how much of that liability a properly structured 1031 defers and how much becomes taxable as boot if you take cash out or reduce your debt.
Who Is This For
Owners of investment or rental property trading up, out-of-state investors consolidating into South Florida, and anyone who has been told to just do a 1031 and wants to see the mechanics and the deadlines before committing.
How It Works
Enter your original purchase price, the depreciation you have taken, your sale price and selling costs, then the price and debt on the replacement property. The calculator shows the deferred amount, any boot created, and the two deadlines you have to meet.
Frequently Asked Questions
What is a 1031 exchange?
A provision that lets you defer tax on the gain from an investment property by rolling the proceeds into another one. The tax is deferred rather than erased — it follows your basis into the new property until you eventually sell without exchanging.
What are the 45-day and 180-day rules?
From the day your sale closes you have 45 days to identify replacement property in writing and 180 days to close on it. The clocks run at the same time, not one after the other, and they count calendar days. Missing either deadline collapses the exchange.
Do I need a qualified intermediary?
Yes. The proceeds must go to a qualified intermediary and never touch your hands or your account. Constructive receipt of the money disqualifies the exchange, which is why the intermediary is engaged before closing, not after.
What is boot?
Anything you receive in the exchange that is not like-kind property. Cash boot is proceeds you keep. Mortgage boot appears when the debt on the replacement property is smaller than the debt you paid off, because that relief is treated as value received. Either one is taxable to the extent of your gain.
Can I exchange my home?
No. Section 1031 applies to property held for investment or productive use in a business. A primary residence does not qualify, though it has its own exclusion under different rules. A rental or investment condo does qualify.
What happens to depreciation?
Depreciation recapture is deferred alongside the capital gain, and your basis carries over into the replacement property. That lower basis means smaller depreciation deductions going forward, which is part of the trade you are making. Work through it with your CPA before the sale closes, not after.