Maximum Tax Rates if You DON'T Do a 1031 Exchange

Capital Gains Tax Rates

Many people want to know the maximum capital gains tax rates if you do not do a 1031 exchange on your property.

Maximum Tax Rates

Here are some of the tax rates you face when selling real property in the state of Minnesota:

  • State of Minnesota Tax on the Entire Gain: 9.85% (this can vary slightly, depending on where the relinquished property is located).
  • Federal Capital Gains Tax on the Appreciation: 20%.
  • Federal Deprecation of Section 1250 Recapture: 25%. Could also have some section 1245 depreciation recapture if the property is treated as ordinary income to the extent of depreciation. 
  • Federal Net Investment Income Tax: 3.8% on amounts of gain over certain thresholds depending on your filing status ($250,000 Married filing jointly / $200,000 filing Single).

Defer These Taxes with a 1031 Exchange

These taxes can really add up. A 1031 exchange allows you to defer your capital gains taxes on the sale of real estate and keep your money working for you over time.

  • 1031 Hotline: If you have questions about 1031 exchanges and capital gains taxes, feel free to call me at 612-643-1031.

Defer the tax. Maximize your gain.


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