Hawaii Capital Gains
Hawaii taxes capital gains in addition to federal tax. Confirm the current rates that apply to you.
Free Investor Tool
1031 Exchange Calculator
Selling an Oahu rental? See how much tax you could owe, including depreciation recapture, and how much a 1031 exchange could help you defer.
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- Private: nothing is saved
1031 Exchange Calculator
Compare an outright sale with a 1031 exchange. Enter your numbers and adjust the tax rates for your situation. Nothing is saved or sent.
Property & Sale
Tax Assumptions
Exchange & Reinvestment
Estimated Tax Deferred
$0
with a fully qualified 1031 exchange
- Total depreciation taken$0
- Total gain on sale$0
- Depreciation recapture tax$0
- Capital gains tax$0
- Total tax if you sell outright$0
- Taxable boot$0
- Estimated tax with 1031$0
- Effective tax rate (no 1031)0%
Educational estimate only, using straight-line depreciation and simplified assumptions. It is not tax or legal advice. Consult a CPA and a qualified intermediary before selling.
Talk With Our TeamHow a 1031 Exchange Works
Defer Taxes and Keep Your Equity Working
When you sell an investment property at a gain, you may owe federal and Hawaii capital gains tax plus tax on depreciation you have claimed over the years. Many owners underestimate that recapture amount.
Section 1031 of the Internal Revenue Code lets you defer those taxes by reinvesting the proceeds into like-kind investment property. Instead of paying tax now, more of your equity stays invested.
- Defer capital gains tax
- Defer depreciation recapture
- Trade up or diversify
- Consolidate or split holdings
Key 1031 Rules & Timelines
A 1031 exchange has strict requirements. Missing one can make the sale taxable.
- Step 1
Identify in 45 Days
Identify potential replacement property in writing within 45 days of closing your sale.
- Step 2
Close in 180 Days
Complete the purchase within 180 days of your sale, including the first 45 days.
- Step 3
Reinvest Everything
To defer all tax, buy property of equal or greater value and reinvest all net proceeds.
- Step 4
Use a Qualified Intermediary
Proceeds must be held by a qualified intermediary. Receiving the money yourself can disqualify the exchange.
Hawaii Considerations
A few local points to discuss with your tax advisor.
HARPTA Withholding
Non-resident sellers are generally subject to Hawaii HARPTA withholding at closing unless an exemption, which may include certain 1031 exchanges, applies.
Like-Kind Is Broad
A condo can generally be exchanged for a single-family rental, multi-family building, commercial property or land held for investment.
Questions
1031 Exchange FAQ
This page is educational and is not tax or legal advice.
How accurate is this calculator?
It uses straight-line depreciation and the rates you enter to produce an estimate. Actual taxes depend on your full tax picture, so verify results with a CPA.
Can I exchange one property for several?
Yes. Exchanges can be structured one-to-many or many-to-one, as long as the identification rules and value requirements are met.
Can I take some cash out?
Yes, but any cash or other non-like-kind value you receive is taxable boot.
Does a vacation home or second home qualify?
Property held primarily for personal use generally does not qualify. Strict limits on personal use apply to property you want to treat as an investment.
Can I buy the new property before selling?
Yes, through a reverse exchange, which requires special structuring with a qualified intermediary.
Will you manage my replacement property?
If your replacement property is on Oahu, we would be happy to help you get it rented and managed.
Talk With Our Team
Planning a Sale or Exchange?
Tell us about your property and plans. We can help you understand rental income on a replacement property and connect you with next steps.