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.
© 2017 Copyright Jeffrey R. Peterson All Rights Reserved