Section 1031 Exchanges Genuine Estate Traders When a real estate investor offers property, a funding gains tax obligation is acknowledged, together with a tax on deprecation recapture. The routine funding gains tax, deprecation regain, as well as any kind of suitable state tax can usually lead to a tax obligation in the 20% to 25% variety for the sale of property. (If the realty has been held for less than year, every one of the gain will be strained at a lot higher short term capital gains rates.).