The short answer
Nevada levies no individual income tax, which makes a 1031 exchange of Nevada property a federal event only: nothing is deferred, withheld or reported at the state level. What Nevada does charge is the real property transfer tax at recording, $1.95 per $500 of value in most counties and $2.55 in Clark County, and a like-kind exchange is not one of the NRS 375.090 exemptions. The larger state-tax question for a Nevada seller is what happens when the replacement DST holds property in a state that does tax income.
Nevada at a glance
| State income tax on gains | None; Nevada has no individual income tax, so there is nothing to defer or withhold |
|---|---|
| Transfer tax, Clark County | $2.55 per $500 of value (NRS 375.020 $1.25 plus NRS 375.023 $1.30) |
| Transfer tax, Washoe and Churchill | $2.05 per $500; every other county $1.95 per $500 |
| Who pays | Buyer and seller jointly and severally liable (NRS 375.030); the contract sets the split |
| Exchange exemption | None; NRS 375.090 lists fourteen exemptions and a 1031 exchange is not among them |
| Property tax cap on rentals and commercial | Increases capped at up to 8% a year (NRS 361.4722); 3% only for owner-occupied homes |
| Commerce Tax | Applies only above $4 million of Nevada gross revenue in a July-June fiscal year |
Nothing to defer at the state level: Nevada has no individual income tax
Nevada does not tax individual income, so a 1031 exchange of Nevada property has no state deferral to elect, no state form to file and no state withholding at closing. The federal identification and closing deadlines and the qualified intermediary requirement are the whole timeline.
That also means boot or a failed exchange costs nothing extra in Nevada; the federal tax is the only income tax. Nevada's state-level touchpoints are the county recorder's real property transfer tax and the Declaration of Value that accompanies every deed.
Real property transfer tax by county: $1.95, $2.05 or $2.55 per $500, and an exchange does not lower it
NRS Chapter 375 stacks three pieces. NRS 375.020 charges 65 cents per $500 of value in counties under 700,000 people and $1.25 in a county of 700,000 or more, which is Clark County; NRS 375.023 adds $1.30 per $500 statewide for the state general fund; and NRS 375.026 lets counties add up to 10 cents.
The result is $1.95 per $500 in most counties, $2.05 in Washoe and Churchill, and $2.55 in Clark County, applied whenever the value exceeds $100. On a $1,500,000 Las Vegas sale the tax is $7,650.
Buyer and seller are jointly and severally liable under NRS 375.030, the contract decides who actually pays, and the escrow holder is not liable. If both legs of your exchange are Nevada deeds, each is taxed; a DST replacement records no Nevada deed, so only the relinquished sale is taxed.
The Declaration of Value sets the tax base, and the recorder will not accept a deed without it
Every document that transfers title in Nevada must be accompanied by a Declaration of Value, the prescribed form the county recorder uses to compute the transfer tax. The value entered is the actual selling price or, where there is no sale price, the estimated fair market value of the property.
In an exchange the relinquished sale has a real price, so the declaration simply mirrors the purchase agreement, and any exemption is claimed on the same form by its NRS 375.090 number. Washoe County staffs a property transfer compliance office inside the recorder to review declarations and exemption claims, so an understated value is not a quiet mistake.
Because buyer and seller are both liable, make the allocation of the tax explicit in the purchase agreement on each Nevada leg before the exchange documents are signed. A DST interest is acquired through the trust's subscription documents rather than a recorded Nevada deed, which is why the replacement side of a DST exchange carries no Nevada transfer tax at all.
NRS 375.090: the exemptions investors use, and the one that is not there
A like-kind exchange is not among the fourteen exemptions in NRS 375.090. The exemptions that matter to investors involve ownership structure rather than the sale itself.
Moving the relinquished property into a wholly owned LLC before sale can therefore be free of transfer tax, but ask your CPA how any pre-closing title change interacts with the federal eligibility requirements before you record anything.
- Exemption 1: a mere change in identity, form or place of organization, such as between affiliated entities with identical common ownership.
- Exemption 9: a transfer to a business entity that the transferor owns 100 percent.
- Exemption 7: a transfer to or from a trust without consideration, with a certificate of trust presented.
- Exemption 4: a transfer between joint tenants or tenants in common without consideration.
Property tax caps: 3% is for owner-occupants, up to 8% is what a rental or commercial buyer inherits
Nevada limits how fast a property tax bill can rise rather than exempting anything at sale. NRS 361.4723 caps the annual increase on an owner-occupied primary residence at 3%, and NRS 361.4722 caps everything else, including rentals, land and commercial buildings, at the lesser of 8% or the greater of the county's ten-year average assessed-value change and twice the prior year's CPI increase.
Clark County's assessor notes that any recorded ownership document removes the owner-occupied 3% abatement, so a buyer of your former rental, or you as buyer of a Nevada replacement, should expect the up-to-8% cap unless the property is an owner-occupied home or a qualifying low-income rental under NRS 361.4724.
Holding the replacement in Nevada: charging orders and the $4 million Commerce Tax line
Investors who buy Nevada replacement property often hold it in a Nevada LLC. NRS 86.401 makes a charging order the exclusive remedy of a member's judgment creditor and bars foreclosure on the membership interest, and the statute applies whether the company has one member or more.
Nevada's Commerce Tax on gross revenue applies only to a business with more than $4,000,000 of Nevada gross revenue in the fiscal year that runs July 1 to June 30; the return is due 45 days after year end, August 14, 2026 for fiscal 2025-26. Whether a passive rental entity's receipts count toward that line is a question for your CPA.
Replacement property
A Nevada seller buying a DST: the income follows the building, and Nevada has nothing to credit against
When a Nevada seller exchanges into a traditional DST offering, the trust's properties are usually in other states, and each property's rental income generally belongs, for tax purposes, to the state it stands in. If that state taxes individual income, it may require a nonresident return from you even though Nevada asks for nothing.
Residents of income-tax states offset that with a home-state credit; a Nevada resident has no home-state tax, so the DST state's tax is a real cost rather than a shift. Sponsors typically report the state-by-state breakdown, and DSTs concentrated in states without an individual income tax avoid the issue.
The same sourcing generally applies when the DST sells and your deferred gain is recognized. Review the property locations in any offering under investment types with your CPA before identifying it within the 45 days.
Questions investors ask about 1031 exchanges in Nevada
Does Nevada charge real property transfer tax on both sides of my exchange?
Only on deeds recorded in Nevada. Selling a Reno warehouse and buying a Henderson retail building means $2.05 per $500 on the sale and $2.55 per $500 on the purchase; buying a DST interest records no Nevada deed.
How much transfer tax is due on a $1,500,000 Clark County sale, and who pays it?
$7,650 at $2.55 per $500. NRS 375.030 makes buyer and seller jointly and severally liable, so the purchase agreement sets the split.
Will I owe income tax on a DST that owns apartments in a state with an income tax?
Generally yes, to that state, on the income and eventual gain sourced there, filed on a nonresident return. Nevada charges nothing and offers no credit because there is no Nevada tax to reduce.
Does the 3% property tax cap on my Nevada home carry over to a rental I buy as replacement property?
No. The 3% cap is only for an owner-occupied primary residence; a rental falls under the up-to-8% cap in NRS 361.4722, and recording the deed removes any prior owner-occupied abatement.
Can I deed my Nevada building into an LLC before the exchange without transfer tax?
A transfer to an entity you own 100 percent is exempt under NRS 375.090(9). Whether doing so shortly before the exchange affects the federal held-for-investment analysis is a question for your CPA.
Which Nevada counties charge more than the $1.95 base rate, and why?
Clark County charges $2.55 per $500 because NRS 375.020 sets $1.25 rather than 65 cents in a county of 700,000 or more; Washoe and Churchill charge $2.05 because each adopted the optional 10-cent county tax under NRS 375.026.
Sources
The rules above were checked against these publications on September 18, 2026. Rates and forms change; confirm the current version with your CPA and the Nevada tax agency before you close. This page is general information, not tax or legal advice.
- NRS 375.020, Imposition and rate of tax
- NRS 375.090, Exemptions
- NRS 361.4722, Partial abatement of taxes (general cap)
- NRS 86.401, Rights and remedies of creditor of member; charging order
- Recorders Association of Nevada, Property Transfer Tax
- Clark County, Tax Abatement
- Nevada Department of Taxation, Commerce Tax
- Washoe County Recorder, Real Property Transfer Tax