US Property Sale Tax Optimization Simulator
Analyze complex tax issues from property dispositions and explore optimal tax-saving strategies.
Standard Sale Tax Calculator
Calculate estimated federal taxes on the sale of investment or business property. Enter the info below and click 'Calculate'.
Estimated Tax Analysis
Total Gain: $0
Depreciation Recapture Tax (at 25%): $0
Capital Gains Tax: $0
Net Investment Income Tax (NIIT): $0
Total Estimated Federal Tax: $0
※ This is an estimated federal tax. State taxes are not included.
Tax Outcome Comparison in Financial Distress
Compare how tax outcomes differ based on debt type (Recourse vs. Non-Recourse) in a foreclosure.
Recourse Debt
The borrower is personally liable. The event is split into two taxable events: the 'sale' and 'cancellation of debt'.
COD Income (Ordinary Income): $0
Gain/Loss on Sale (Capital Loss): $0
Conclusion: Despite a capital loss, you may have to pay tax on the separate ordinary income (COD).
Non-Recourse Debt
Liability is limited to the collateral asset. It's treated as a single 'sale' event.
Cancellation of Debt Income: $0
Gain/Loss on Sale (Capital Loss): $0
Conclusion: Only a capital loss is generated with no COD income, generally resulting in a lower tax burden.
Core Tax-Saving Strategy: 1031 Like-Kind Exchange
Simulate the effects of a 1031 exchange, a powerful strategy to indefinitely defer taxes on property sales.
1031 Exchange Analysis Results
Total Realized Gain: $0
(The gain that would be taxed without deferral)
Taxable Boot: $0
Non-like-kind property received (e.g., cash or debt reduction), which is immediately taxable.
Recognized Gain: $0
The portion of the realized gain taxed in the current year, equal to the boot received.
Deferred Gain: $0
The gain successfully deferred to the replacement property.
New Property's Basis: $0
The basis is lowered by the deferred gain, carrying the tax liability forward.
Other Strategy 1: Installment Sale
A strategy to reduce the tax burden in a given year by spreading out gain recognition over several years as payments are received. This helps maintain a lower tax bracket. However, any depreciation recapture gain must be recognized in the year of the sale.
Other Strategy 2: Capital Loss Harvesting
A strategy to offset capital gains from a property sale with capital losses from other investments (e.g., stocks). Long-term losses offset long-term gains first. Up to $3,000 of net capital loss can be deducted against ordinary income annually, with the remainder carried over indefinitely.