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Boot Basis Calculator

Boot in 1031 exchange creates taxable gain. This calculator sizes exposure.

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Taxable boot

$225,000

Total gain

$1,700,000

Total boot

$225,000

How the math works

Total boot = cash + debt relieved. Taxable boot = min(gain, boot).

Structure exchanges to consume all boot via additional investment. A $150k cash boot at a combined 28-30% rate is $42-45k in taxes; adding that amount to replacement property equity creates a better asset and avoids the tax event. Almost always the right call.

How to Use

  1. Enter relinquished property sale price.
  2. Enter relinquished basis.
  3. Enter replacement property cost.
  4. Enter cash received (boot).
  5. Enter debt relieved.
  6. Read taxable boot.

Frequently Asked Questions

Types of boot?

Cash boot: cash or equivalent received in exchange. Mortgage boot: mortgage relief (old debt higher than new debt). Both trigger partial taxable gain. To fully defer: replace equal or higher value AND equal or higher debt AND reinvest all cash.

Tax treatment?

Boot taxable up to gain amount. Gain = sale price − basis. Boot exceeding gain not taxable (just not deferred). Capital gain rates (20% fed + state + 3.8% NIIT). Can be depreciation recapture on depreciated property (25% fed rate on recapture portion).

Avoiding boot?

Trade up: higher value + higher debt. Reinvest 100% cash. Add own cash if needed to match debt profile. Structure as multi-property exchange. Boot avoidance typically saves 25-30% in immediate taxes.

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