1031 Exchange Calculator
A 1031 exchange defers capital gains tax — but only if you nail the deadlines and replace both the equity and the debt. This calculator shows your 45-day and 180-day deadlines plus how much gain you’ll defer vs. recognize as boot.
Sale of Relinquished Property
A 1031 exchange defers capital gains tax if you reinvest sale proceeds into "like-kind" investment real estate within strict deadlines.
Original price + improvements − depreciation taken.
Commission, closing, transfer tax.
Loan paid off at sale.
Replacement Property
Loan on the replacement property.
Deadlines
Day 0 — the 1031 clock starts.
Identify replacement properties in writing to your QI.
Close on replacement property by this date.
Gain & Boot
The two deadlines
- 45 calendar days from sale close to identify replacement properties in writing to your QI. No extensions for weekends or holidays.
- 180 calendar days from sale close to close on identified replacement(s). No extensions.
The boot rules
To fully defer your gain, you must:
- Reinvest all sale proceeds (after costs) into the replacement.
- Take on debt equal to or greater than the debt relieved on the sale.
- Buy a replacement property of equal or greater value.
Anything you fall short on becomes "boot" — taxable now. Cash you keep = cash boot. Debt not replaced = debt boot.
Frequently asked questions
What is a 1031 exchange?
A 1031 exchange (Section 1031 of the IRS code) lets investment real estate sellers defer capital gains tax by reinvesting proceeds into "like-kind" investment real estate. The tax bill rolls forward to the eventual sale of the replacement property.
What are the deadlines?
From the day you close on the sale: 45 calendar days to identify replacement properties in writing to your Qualified Intermediary (QI), and 180 days to close on the replacement(s). Both clocks run simultaneously. Miss either deadline, and the entire deferral is blown.
What is "boot"?
Boot is the portion of sale proceeds you don’t reinvest. Cash boot = sale proceeds you keep. Debt boot = mortgage debt you pay off and don’t replace with equal or greater debt on the new property. Both are immediately taxable. To fully defer, you must reinvest all proceeds AND replace debt of equal or greater value.
What qualifies as "like-kind"?
Any investment or business real estate within the United States. A duplex can be exchanged for a strip mall, raw land, or a self-storage facility. Personal residences and house flips do NOT qualify (the latter because they’re held as inventory, not investments).
Do I need a Qualified Intermediary?
Yes — required by law. You cannot touch the sale proceeds. The QI holds funds during the exchange period and disburses them to close the replacement. Standard QI fee is $800–$1,500 per exchange.
Can I exchange into multiple properties?
Yes, with rules. The "Three-Property Rule" lets you identify up to 3 properties of any value. The "200% Rule" lets you identify any number whose total value is up to 200% of the sale price. The "95% Rule" lets you identify unlimited properties if you close on 95%+ of identified value.
Does a 1031 exchange make sense for everyone?
No. If your basis is high (low gain) or you’re in a low tax bracket, the deferral may not be worth the QI fees, deadline pressure, and reduced flexibility. Run the projected tax bill against the cost and complexity. For large gains in high-tax states, 1031s often save 25–40% of sale proceeds.
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