Estate tax calculator for property investors
Your numbers
Your result
- Portfolio value in 20 yearsAt 3% annual appreciation
- $4,515,278
- Capital gain triggered at death
- $3,315,278
- Tax on the capital gain
- $887,334
- Tax on recaptured depreciation
- $0
- Estimated tax bill at death
- $887,334
- Liquid cash available to pay it
- $100,000
- Shortfall your estate must findUsually met by selling property under pressure
- $787,334
- Equity in the portfolio
- $3,615,278
Your family would need roughly $787,334 in cash the year you die. Without it, the estate sells doors — usually fast, and rarely at the price you'd have accepted. Insurance funded now typically costs a fraction of that number.
How this is calculated
- On death you are deemed to dispose of your properties at fair market value, triggering the accrued capital gain (principal residence excluded).
- Capital gains inclusion rate of 50%, taxed at Ontario's top marginal rate of 53.53%.
- Recaptured capital cost allowance is fully taxable as income in the year of death.
- Assumes no surviving-spouse rollover. A spousal rollover defers the bill to the second death — it does not remove it.
- Ignores probate fees, land transfer implications of any restructuring, and provincial differences outside Ontario.
This is an estimate for planning discussion only — not tax, legal or investment advice. Your actual result depends on your full situation.
Why this number surprises people
Two things compound at once: the portfolio value, and the gap between that value and what you originally paid. A portfolio bought for $1.2M and worth $2.5M today doesn't owe tax on $1.3M forever — in twenty years at 3% appreciation it owes tax on well over $3M. Meanwhile the cash to pay it hasn't grown at all.
There are only three ways this ends: your family sells doors, your family borrows, or the liability was funded in advance. The third is the only one you control today.