Tax & Disposition (Gain/Loss Analysis)
Forecast taxable gain using integrated NOI underwriting, projected sale pricing, adjusted tax basis, and selling costs in a single disposition model.
Why do real estate investors use the Tax & Disposition calculation?
Because the profit realized upon selling an asset is rarely simply the difference between the sale price and the original purchase price.
This calculation accounts for adjusted tax basis, selling costs, and depreciation recapture exposure. It allows investors to forecast their true taxable gain and determine whether strategies like a 1031 Exchange are necessary to preserve capital.
Calculator · Tax & Disposition
Disposition analysis
Define your projected exit, selling costs, acquisition history, improvements, and depreciation schedule to compute your taxable gain or loss.
Property Type
Potential Rent Income
$
Vacancy & Credit Loss
%
%
Other Income
$
$
$
$
$
Operating Expenses
$
$
$
$
$
$
$
$
%
Annual NOI growth. Can be negative.
%
Market cap rate at sale.
yrs
Years held at time of sale. NOI compounds at growth rate for this period.
Disposition Inputs
$
$
$
$
$
Tax Basis Inputs
$
$
$
$
$
Capital Improvements
$
$
$
Depreciation
$
Land is not depreciable. Enter your appraised or allocated land value.
yrs
yrs
Should match Holding Period for a clean exit analysis.
Results · Live
Gain on Disposition
Net sales proceeds minus adjusted tax basis.
Awaiting your figures
Fill in all sections on the left, then hit Analyze Disposition.
Gain on Disposition
$0
— of adjusted tax basis · —
Gain Exposure · % of Adjusted Tax Basis · Scale 0–50%
Minimal ≤15%
Market Std
Wealth Gen >30%
—
—
Gross Sale Price Allocation
Selling Expenses
—
Adjusted Tax Basis
—
Gain on Disposition
—
Property Type
—
Net Operating Income
—
Gross Sales Price
—
Selling Expenses
—
Net Sales Proceeds
—
Total Cost Basis
—
Accumulated Depreciation
—
Adjusted Tax Basis
—
Gain on Disposition
—
—
Depreciation Recapture Watch
Monitor accumulated depreciation and adjusted basis before disposition to model recapture exposure.
Tax & Disposition Example & Formula
Institutional-style exit modeling that integrates NOI underwriting, basis tracking, depreciation, and loan cost adjustments into a true taxable gain forecast.
Gain on Disposition = Net Sales Proceeds − Adjusted Tax Basis
Next-Year NOI = NOI × (1 + Growth Rate)^Holding Period
Gross Sales Price = Next-Year NOI ÷ Exit Cap Rate
Net Sales Proceeds = Gross Sales Price − Selling Expenses
Adjusted Tax Basis = Total Cost Basis − Accumulated Depreciation
Step 1 · Net Operating Income
Rent → Vacancy/Credit Loss → Other Income → Operating Expenses → NOI
$179,920
Step 2 · Next-Year NOI
NOI × (1 + Growth Rate)^Holding Period
$208,668
Step 3 · Gross Sales Price
Next-Year NOI ÷ Exit Cap Rate
$3,477,800
Step 4 · Selling Expenses
Brokerage + Transfer Taxes + Escrow + Legal + Concessions
$195,500
Step 5 · Net Sales Proceeds
Gross Sales Price − Selling Expenses
$3,282,300
Step 6 · Closing Costs
Legal + Appraisal + Transfer Taxes + Title Insurance
$150,000
Step 7 · Beginning Basis
Purchase Price + Closing Costs
$2,650,000
Step 8 · Capital Improvements
Structural + Tenant Improvements + Site Enhancements
$200,000
Step 9 · Total Cost Basis
Beginning Basis + Capital Improvements
$2,850,000
Step 10 · Depreciable Basis
Total Cost Basis − Land Value
$2,300,000
Step 11 · Annual Depreciation
Depreciable Basis ÷ Recovery Period (39 yrs)
$58,974
Step 12 · Accumulated Depreciation
Annual Depreciation × Years Owned (5 yrs)
$294,870
Step 13 · Adjusted Tax Basis
Total Cost Basis − Accumulated Depreciation
$2,387,435
Step 14 · Gain on Disposition
Net Sales Proceeds − Adjusted Tax Basis
$894,865
Final Result
Gain on Disposition = $894,865
$3,282,300 − $2,387,435 = $894,865. This represents the estimated taxable gain after accounting for selling expenses and adjusted tax basis. Investors use this figure to evaluate tax exposure and determine whether a 1031 exchange strategy is appropriate.
© Annie Scott Realty Group LLC
Estimates only · not tax advice
