What This 1031 Boot Calculator Does

FeatureDescription
Cash BootAny cash you receive from the exchange (taxable)
Debt Relief BootMortgage sold > mortgage new (taxable difference)
Total BootCash Boot + Debt Relief
Recognized GainLesser of Realized Gain or Total Boot (tax due now)
Deferred GainRealized Gain – Recognized Gain (tax-free rollover)
Tax CalculationCapital gains + state tax on recognized gain
Capital Gains Rates15%, 18%, 20%, 23.8% (including NIIT)

Boot Calculation Formula

Cash Boot = Cash received from exchange
Debt Relief Boot = MAX(0, Mortgage Sold - Mortgage New)
Total Boot = Cash Boot + Debt Relief Boot
Recognized Gain = MIN(Realized Gain, Total Boot)
Deferred Gain = Realized Gain - Recognized Gain

Example Calculation

Relinquished Property:

  • Sale Price: $500,000
  • Adjusted Basis: $270,000
  • Selling Expenses: $30,000
  • Mortgage Sold: $200,000

Replacement Property:

  • New Price: $550,000
  • Mortgage New: $250,000
  • Cash Boot: $0
CalculationAmount
Realized Gain$200,000
Debt Relief$0 (200k – 250k = negative)
Total Boot$0
Recognized Gain$0
Deferred Gain$200,000
Tax Saved~$40,000

When Boot is Taxable

ScenarioBoot AmountTaxable?
Cash received$50,000✅ Yes
Mortgage sold > mortgage new$30,000✅ Yes
Both cash + debt relief$80,000✅ Yes
No cash, equal mortgages$0❌ No

How to Avoid Boot

RequirementDescription
Equal or Greater ValueNew property ≥ sold property
Reinvest All EquityPut all sale proceeds into new property
Equal or Greater DebtNew mortgage ≥ old mortgage
No Cash OutDon’t take cash from the exchange

Keyboard Shortcuts

  • Ctrl/Cmd + Enter — Recalculate
  • Ctrl/Cmd + R — Reset to defaults
1031 exchange boot calculator real estate
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