1031 Exchange Calculator
A 1031 exchange lets real-estate investors defer capital-gains tax by rolling the proceeds of a sale into a like-kind property. This shows the gain and the tax you'd defer.
Your details
- Capital gain
- $200,000.00
Deferred tax vs reinvested
- Deferred tax
- $40,000.007%
- Reinvested proceeds
- $560,000.0093%
Formula
Capital gain = sale price − adjusted cost basis. Deferred tax = gain × your capital-gains rate. In a valid 1031 exchange, that tax is postponed rather than paid now.
How it works
Deferring the tax keeps your full equity working in the next property, compounding your returns. The rules are strict — like-kind investment property, a qualified intermediary, 45 days to identify and 180 days to close — so plan with a professional.
Frequently asked questions
What is a 1031 exchange?⌄
A tax provision that lets you defer capital-gains tax when you sell an investment property and reinvest the proceeds into another like-kind investment property, following IRS rules and deadlines.
Is the tax eliminated or just deferred?⌄
Deferred. You postpone the tax by rolling gains into new property; it becomes due if you eventually sell without another exchange (though strategies exist to defer further).
What are the 1031 deadlines?⌄
You have 45 days after the sale to identify replacement property and 180 days to close. Missing these deadlines disqualifies the exchange, so a qualified intermediary is essential.
Sources & methodology
Gain × rate deferred. Simplified — excludes depreciation recapture, boot, and closing costs. Not tax advice.
- •IRS — like-kind exchanges — IRS
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