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Hold, Sell, or Pass It On

Hold, sell, or pass it on?

Compare what selling now costs in tax against holding to the §1014 step-up — where your heirs inherit a reset basis and the built-in gain can disappear.

Your numbers

Rough figures are fine. Everything updates live.

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Two paths for the same property
Built-in gain today · $290,000
Your Landlord Guide
Est. 2026
Sell now
$64,500 – $86,770

Estimated tax owed on today’s gain — recapture, capital gains, and state, all due in the year you sell.

Hold to a step-up (§1014)An estimate for discussion
~$0

Your heirs inherit a basis reset to fair market value, so today’s built-in gain is erased — roughly $0in tax on the gain you’ve accrued so far.

The honest trade-offs.The step-up only lands if you hold the property until death — the equity isn’t accessible as cash in the meantime. Some states levy their own estate tax below the federal exemption, so “pass it on” isn’t always tax-free at the state line.

Informational purposes only — estimates for discussion, not tax, legal, or financial advice. No professional-client relationship is created. Consult a qualified CPA about your situation.

Confirm your figure with a specialist

A specialist weighs the step-up against your goals, your state, and your cash needs — no obligation.

How this is calculated · sources

Every figure traces to a source

What this estimate assumes

  • How much steps up depends on how the property is titled: sole ownership and community property revalue in full, but joint ownership in a common-law state revalues only the deceased owner's share — so roughly half the gain survives.
  • The step-up assumes you hold the property until death. Gifting it during your lifetime carries your basis across instead, and forfeits this entirely.
  • The equity isn’t accessible as cash while you hold.
  • Some states levy estate tax below the federal exemption — Massachusetts notably. That isn't in the number here.
  • Sell-now figure: depreciation recapture uses the 25% cap, which only covers the building — anything a cost segregation study accelerated comes back at your ordinary rate.
  • Sell-now figure: capital gains shown as a 15–20% band rather than computed from your total income; a 0% band exists at lower incomes.
  • Sell-now figure: state tax applied as one flat rate to the whole gain; “Other state” is a rough placeholder.