Calculators / 1031 Exchange Calculator
Tax deferral · IRC Section 1031

1031 Exchange Calculator

Estimate how much tax a 1031 exchange could defer, whether any boot becomes taxable, and the 45-day and 180-day deadlines from your closing date. The figures below are an example. This is an estimate, not tax advice.

Property you are selling
Replacement property
Tax rates
Example figures shown. Results update as you type.
Estimated tax deferred––
Adjusted basis
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Capital gain
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Equity from sale
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Cash boot
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Mortgage boot
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Gain deferred
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Tax if you sell outright
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Tax on boot in exchange
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Equal-or-greater value test
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Your exchange deadlines

Identify replacement by (day 45)
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Close replacement by (day 180)
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Depreciation recapture is estimated at the 25% maximum federal rate. Actual tax depends on your income, state and holding history. Confirm with a CPA and a qualified intermediary.

How a 1031 exchange defers tax

Section 1031 of the Internal Revenue Code lets you sell an investment property and roll the proceeds into another "like-kind" investment property without paying capital gains tax at the time of sale. The gain is not forgiven; it carries into the new property's basis and is due when you eventually sell without exchanging.

Capital gain = Net sale price − (Purchase price + Improvements − Depreciation)

Rules for full deferral

  • Buy replacement property of equal or greater value than the net sale price.
  • Reinvest all of the net equity. Cash you take out is taxable "cash boot".
  • Replace the debt you paid off with new debt or with extra cash. Debt you don't replace is "mortgage boot".
  • Never touch the proceeds. A qualified intermediary must hold the funds between closings.

The 45-day and 180-day deadlines

You have 45 calendar days from closing on the property you sell to identify replacement properties in writing, and 180 calendar days to close on the replacement. Both clocks run at the same time, and weekends and holidays are not excluded. Missing either one usually ends the exchange.

What is boot?

Boot is anything you receive in the exchange that is not like-kind property: cash, debt relief that is not replaced, or other property. Boot is taxable up to the amount of your gain, starting with depreciation recapture.

Frequently asked questions

Can I do a 1031 exchange on my primary residence?

No. Section 1031 applies to property held for investment or business use. A primary home may qualify for the separate Section 121 exclusion instead.

Do I have to buy a more expensive property?

To defer all of the tax, the replacement should cost at least as much as the net sale price and you must reinvest all the equity. Buying for less is allowed, but the difference is generally taxable boot.

What happens to depreciation in a 1031 exchange?

Depreciation recapture is deferred along with the capital gain. Your basis carries over to the new property, so the deferred recapture is still owed if you later sell without another exchange.

Do I need a qualified intermediary?

Yes. If you or your agent receive the sale proceeds, even briefly, the exchange generally fails. The intermediary holds the funds and handles the exchange documents.