Free Wealth Management Guide Financial Strategies For Selling A Farm Or Ranch | Page 4
1031 Exchange
TAX & ESTATE PLANNING ANALYSIS
Sale Price: $15,000,000
Land
Building
Equipment & Livestock
Raised Livestock
Total
$14,000,000
93.33%
$100,000
0.67%
$600,000
4.00%
$300,000
2.00%
$15,000,000
Accumulated Depreciation
$1,200,000
0
$100,000
$100,000
$700,000
$700,000
0
0
$2,000,000
$800,000
Basis
$1,200,000
0
0
0
$1,200,000
($5,000,000)
0
0
0
($5,000,000)
$8,228,571
$100,000
$600,000
$300,000
$9,228,571
Sales Price Allocation
Original Cost
1031 Exchange
Realized Gain
Recapture Gain
0
$100,000
$600,000
0
$700,000
$8,228,571
$8,228,571
0
$100,000
0
$600,000
$300,000
$300,000
$8,228,571
$9,228,571
0
0
$1,234,286
$1,234,286
0
$25,000
0
$25,000
$210,000
0
0
$210,000
0
0
$45,000
$45,000
$210,000
$25,000
$1,279,286
$1,514,286
0
$403,200
$403,200
$6,900
0
$6,900
$41,400
0
$41,400
0
$14,700
$14,700
$48,300
$417,900
$466,200
$1,637,486
$31,900
$251,400
$59,700
$1,980,486
Net Cash After Tax
$7,362,514
$68,100
$348,600
$240,300
$8,019,514
Effective Tax Rate
13.20%
Capital Gain
Projected Tax
Federal
1245 Recapture Gain (35%)
1250 Recapture Gain (25%)
Long Term Capital Gain (15%)
Total Federal Tax
State
Recapture Rate (6.9%)
Capital Gain (4.9%)
Total State Tax
Total Tax Liability
CASH FLOW
Projected Annual Income (Cash Investment)
Projected Annual Income (1031)
$561,366
$350,000
Total Annual Income
$911,366
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