Question on 1031 replacement property sale
Hi ya'll!
Is there a calculator to determine the final capital gains taxes I would pay on the sale of a replacement 1031 exchange property? I'm struggling to decide if we should sell our STR. Profits average $30K/year.
Original purchase price: $270,000
Bought out business partner with new value at $300,000
Sale price: $414,000
(1031 exchange) New condo purchase price: $675,000
Sale of boat slip and garage attached to condo: $100,000
Sale price of condo: $1M
Thanks!
Lindsey
#4 Buying & Selling Real Estate Contributor
- Rental Property Investor
- Hanover Twp, PA
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#4 Buying & Selling Real Estate Contributor
- Rental Property Investor
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@Lindsay Op de Coul, I think its even more complicated than you think. You need to factor in depreciation as well. I think you need to look at the purchase dates, in-service dates, and sale dates in addition to the info you provided to get any kind of estimate.
Hi @Kevin Sobilo - always love seeing you in the forum posts! You tagged the wrong Lindsay though ;P
@Lindsey Milam - Kevin gives sound investing and business advice in my experience!
#4 Buying & Selling Real Estate Contributor
- Rental Property Investor
- Hanover Twp, PA
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#4 Buying & Selling Real Estate Contributor
- Rental Property Investor
- Hanover Twp, PA
Quote from @Lindsay Op de Coul:
Hi @Kevin Sobilo - always love seeing you in the forum posts! You tagged the wrong Lindsay though ;P
@Lindsey Milam - Kevin gives sound investing and business advice in my experience!
@Lindsay Op de Coul, thank you for the kind words! You must be the most popular Lindsay on BP and bubbled to the top of the list! lol. I corrected my response.
#1 1031 Exchanges Contributor
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#1 1031 Exchanges Contributor
- Qualified Intermediary for 1031 Exchanges
- St. Petersburg, FL
@Lindsay Op de Coul, Of course if you do a full 1031 you'll pay no tax. I'm a little fuzzy on what's being sold and what's being purchased. But as long as you purchase at least as much as your net sale and use all of the proceeds from the sale in your purchase you will defer all tax in the 1031.
There's several ways to arrive at your potential tax liability - some more accurate and some more hand grenade mathish. Calculating your basis. is the start. Then adjusting that for depreciation and capitalized improvements. If this property was the replacement in a prior 1031 then your starting basis would have been carried over from the property you sold to start the 1031. We do have a calculator you can use. And you can set up a call with one of our folks who specializes in helping investors calculate potential tax liability in general terms. But your accountant and your tax return are going be the most accurate source for this info.
@Dave Foster
Loved reading the above.
I'll post a new thread.
Thank you everyone!!!