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The basics
A property card can represent a home you already own or a future purchase. Set the purchase year, down payment, closing costs, and funding source for a future property.
A planned sale has its own year and selling-cost percentage. Its proceeds enter the household’s cash flow after the loan and modeled transaction costs and taxes are accounted for.
Illustrative numbers
A $500,000 purchase
Price in the purchase year$500,000
Down payment at 20%$100,000
Closing costs at 3%$15,000
Initial mortgage$400,000
The plan needs $115,000 for the purchase before any tax cost of raising that money. Funding it from a taxable or retirement account can create additional tax.
Calculation transparency
How it works in MoneyWhatIf
- 01
A scheduled purchase occurs at the start of its year. The property’s price can change before purchase, but its value, debt, rent, and ownership costs do not belong to the household until then.
- 02
A scheduled sale occurs at year-end, so the plan includes that year’s ownership costs and rent. Selling costs reduce both cash proceeds and the amount used to calculate the gain.
- 03
Basis, property use, improvements, and any depreciation affect the modeled taxable gain. A primary home can receive the model’s home-sale exclusion where its rules apply.
- 04
When funding runs short, the selling settings may also cause a forced property sale. The plan then recalculates later rent, loan payments, and ownership costs. Route extra sale cash through Cash flow priorities.
Keep in mind
Model limits
The annual model does not choose a closing day or simulate a purchase contingency, bridge loan, or an actual listing process.
Review the sale and funding year in detail: a property sale can raise income-sensitive taxes and health costs beyond the tax on the gain itself.
This explanation documents the planning model. It is educational, not individualized tax, legal, Medicare, or investment advice.
Where it appears
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The words behind it
Related financial terms
Plain-English definitions, with 2026 figures and worked examples, from the financial terms glossary.