Calculate your 1031 like-kind exchange: deferred gain, boot, minimum replacement property value, and taxes saved.
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Commission + closing costs
Federal: 15–20%
The Chen family is buying a $340,000 home in Columbus, Ohio. Combined income $115,000, 10% down payment, 30-year fixed at 7.125%.
Takeaway: Columbus/Franklin County averages are the reference baseline. Property tax rates and insurance premiums shift significantly by ZIP code and HOA status. Plug your actual numbers in above.
We default to state-average millage rates. County and municipal rates vary 40%+ within a single state. Ohio ranges from 0.8% (rural counties) to 2.4% (Cuyahoga/Cleveland area). Always cross-check your specific county assessor's published effective rate.
Property Tax by StateHomeowner association fees add $100-$800/month in condos and planned communities. Condos in urban markets often run $400-$700/month. If your property has HOA, add it manually to any payment estimate — it directly affects your debt-to-income ratio for loan qualification.
HOA Fee CalculatorClosing costs typically run 2-5% of the loan amount — around $6,000-$15,000 on a $300K home. Lender fees, title insurance, escrow, and prepaid taxes add up fast. These are due at closing in cash, not rolled into the mortgage by default.
Closing Costs CalculatorPrivate mortgage insurance (PMI) costs 0.5-1.5% of the loan annually until you reach 20% equity. On a $300K loan at 1%, that's $250/month. PMI cancels automatically at 78% LTV under federal law — but you can request removal at 80%.
National home price appreciation has averaged ~4% annually since 1968, but markets diverge dramatically. Sun Belt metros averaged 10%+ during 2020-2022; coastal markets often lag the national average during correction cycles. Local supply constraints are the main driver.
If you've lived in the home 2 of the last 5 years, you can exclude $250K (single) or $500K (married) of gain from federal capital gains tax. Many calculators show gross profit without applying this exclusion. Relevant when projecting sale proceeds.
Home Sale Capital Gains CalculatorBased on your inputs
Taxes you avoid now
Taxable cash received
| Sale Price | $500,000 |
|---|---|
| Less Selling Costs | -$30,000 |
| Less Adjusted Basis | -$230,000 |
| Total Gain Realized | $240,000 |
| Minimum Replacement Value | $470,000 |
| Replacement Property Price | $600,000 |
| Total Boot (Taxable) | $120,000 |
| Taxable Gain | $120,000 |
| Deferred Gain | $120,000 |
| Tax Owed Now | $24,000 |
| Tax Deferred (Saved Now) | $24,000 |
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A 1031 like-kind exchange lets real estate investors defer capital gains taxes by selling one investment property and buying another of equal or greater value. You have 45 days to identify replacement property and 180 days to close.
Boot is cash or non-like-kind property received in an exchange. If you buy a cheaper replacement or keep some cash, that's boot — and it's taxable. To defer ALL taxes, reinvest all equity into equal-or-greater value property.
No. Section 1031 applies to investment and business properties only. Primary residences qualify for the Section 121 exclusion ($250K/$500K) instead.
Day 0: You close on the sold property. Day 45: Identify up to 3 potential replacement properties (or more with the 200% rule). Day 180: Close on replacement property. Miss either deadline, and the exchange fails — you owe taxes.
They 'carry forward' to the replacement property, reducing its basis. When you eventually sell without exchanging again, you pay all accumulated deferred taxes. Or you can continue exchanging indefinitely, potentially passing stepped-up basis to heirs at death.
A qualified intermediary typically charges $750-$1,500 for a standard 1031 exchange. Reverse exchanges cost $3,000-$6,000. The QI holds your sale proceeds and facilitates the exchange. Using a QI is required by IRS rules since you cannot touch the funds directly.
Yes. You can exchange property in one state for property in another. However, some states like California require tracking deferred gains and may tax them when you sell the replacement property even if it is in a different state. Consult a tax advisor for multi-state exchanges.
A reverse exchange lets you buy the replacement property before selling the relinquished property. This is useful in competitive markets. The replacement property is held by an Exchange Accommodation Titleholder. Reverse exchanges cost more and are more complex but follow the same 45/180-day deadlines.
When a property owner dies, heirs receive the property at its current fair market value, eliminating all deferred capital gains. Investors who continually exchange properties can defer taxes for decades and potentially pass properties to heirs with zero capital gains tax owed.
Common failures include missing the 45-day identification deadline, missing the 180-day closing deadline, touching the proceeds directly, insufficient replacement property value creating taxable boot, and failing to use a qualified intermediary. Proper planning with experienced professionals prevents most failures.
Gain Realized = Sale Price − Selling Costs − Adjusted Basis
Boot = Equity Not Reinvested + Mortgage Relief
Taxable Gain = Min(Gain Realized, Boot)
Deferred Gain = Gain Realized − Taxable Gain
Every formula on this page traces to a federal agency, central bank, or peer-reviewed institution. We cite the rule-makers, not secondhand blogs.
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Calculations are for educational purposes only. Consult a qualified financial advisor for personalized advice.