This calculator is for illustration only. The results are hypothetical, depend entirely on the assumptions entered, and are not a guarantee of future results. Actual nightly rates, occupancy, expenses, interest rates, and home values can be very different from these estimates, and you can lose money on a real estate investment. Pre-tax figures leave out income taxes. After-tax figures use the federal rates entered above, leave out state income tax, and assume the rental losses can offset your other income each year, which depends on how much you take part in running the rental and on your overall tax picture. A 1031 exchange into a Delaware Statutory Trust (DST) defers the tax on the sale but does not remove it. DSTs are illiquid, are generally available only to accredited investors, and can lose value.
All results are hypothetical, change whenever the inputs change, and are not a prediction of what will happen. Method: the loan is amortized monthly; property tax and maintenance are figured on each year's ending home value; depreciation after the year 1 bonus is straight-line; at a sale, bonus depreciation is recaptured first, then straight-line depreciation, then the rest is taxed as a capital gain.
Prepared by Nirav Desai, Founder & Financial Advisor, Qubera Wealth Management. quberawealth.com