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Re: Unforseen or unanticipated Costs in Retirement
[Re: Dave Davidson]
#9024439
03/25/24 06:31 PM
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Joined: Dec 2011
Posts: 14,302
Ramsey
Pepe' Le Pew
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Pepe' Le Pew
Joined: Dec 2011
Posts: 14,302 |
The oldest consideration about money is not how much you make or have. It’s how much you spend.
Although we are financially secure and debt free, inflation is a big consideration. Taxes are real. We recently sold one rent house that was 100% depreciated. That will have to be recovered at tax time. About to give the other one to my grandson and his wife.
I’m considering selling my 133 acres of rural property 70 miles from the metroplex in Montague County. Getting too old and arthritic to do it right and enjoy it. It’s junk land that the realtors call recreational property. Meeting a fence guy this afternoon. I can no longer do that. It will be a huge profit after 40 years of ownership. But again, taxes and realtor fees will take a bunch.
Ya know, this old age and arthritis was supposed to happen to other people. Not me. Before you sell this land consider if it is passed on after you passthe beneficiaries will pay no taxes as their badis will be current value. It is called step up, you might want to see if there is a way to leverage your assets without selling.
Big Beckett!!
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Re: Unforseen or unanticipated Costs in Retirement
[Re: Ramsey]
#9024442
03/25/24 06:34 PM
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Joined: Jan 2013
Posts: 19,666
Pitchfork Predator
THF Celebrity
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THF Celebrity
Joined: Jan 2013
Posts: 19,666 |
The oldest consideration about money is not how much you make or have. It’s how much you spend.
Although we are financially secure and debt free, inflation is a big consideration. Taxes are real. We recently sold one rent house that was 100% depreciated. That will have to be recovered at tax time. About to give the other one to my grandson and his wife.
I’m considering selling my 133 acres of rural property 70 miles from the metroplex in Montague County. Getting too old and arthritic to do it right and enjoy it. It’s junk land that the realtors call recreational property. Meeting a fence guy this afternoon. I can no longer do that. It will be a huge profit after 40 years of ownership. But again, taxes and realtor fees will take a bunch.
Ya know, this old age and arthritis was supposed to happen to other people. Not me. Before you sell this land consider if it is passed on after you passthe beneficiaries will pay no taxes as their badis will be current value. It is called step up, you might want to see if there is a way to leverage your assets without selling. This is incorrect my friend…..this would only be true of his homestead….
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Re: Unforseen or unanticipated Costs in Retirement
[Re: Pitchfork Predator]
#9024446
03/25/24 06:46 PM
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Joined: Dec 2011
Posts: 14,302
Ramsey
Pepe' Le Pew
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Pepe' Le Pew
Joined: Dec 2011
Posts: 14,302 |
The oldest consideration about money is not how much you make or have. It’s how much you spend.
Although we are financially secure and debt free, inflation is a big consideration. Taxes are real. We recently sold one rent house that was 100% depreciated. That will have to be recovered at tax time. About to give the other one to my grandson and his wife.
I’m considering selling my 133 acres of rural property 70 miles from the metroplex in Montague County. Getting too old and arthritic to do it right and enjoy it. It’s junk land that the realtors call recreational property. Meeting a fence guy this afternoon. I can no longer do that. It will be a huge profit after 40 years of ownership. But again, taxes and realtor fees will take a bunch.
Ya know, this old age and arthritis was supposed to happen to other people. Not me. Before you sell this land consider if it is passed on after you passthe beneficiaries will pay no taxes as their badis will be current value. It is called step up, you might want to see if there is a way to leverage your assets without selling. This is incorrect my friend…..this would only be true of his homestead…. I need to find out, this was direst from attorney consultation earlier in the year regarding my portfolio. Not arguing, just need to know what my options are.
Big Beckett!!
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Re: Unforseen or unanticipated Costs in Retirement
[Re: DQ Kid]
#9024448
03/25/24 06:50 PM
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Joined: Jan 2013
Posts: 19,666
Pitchfork Predator
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This is the reason most ranches get sold and leases go away because the beneficiary doesn’t want to or can’t pay the capital gains taxes and sometimes estate tax as well.
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Re: Unforseen or unanticipated Costs in Retirement
[Re: Pitchfork Predator]
#9024452
03/25/24 07:03 PM
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Joined: Dec 2011
Posts: 14,302
Ramsey
Pepe' Le Pew
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Posts: 14,302 |
This is the reason most ranches get sold and leases go away because the beneficiary doesn’t want to or can’t pay the capital gains taxes and sometimes estate tax as well. Marc I am looking and cant find anything on IRS sites that differentiate at all, They even allow spouses to use step up after one dies for rental properties fir half the value. I wish there was a way to clear this up, my focus is residential real estate properties. I do not see anything that is differnt for land, but again I am not a attorney.
Big Beckett!!
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Re: Unforseen or unanticipated Costs in Retirement
[Re: DQ Kid]
#9024455
03/25/24 07:06 PM
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Joined: Dec 2011
Posts: 14,302
Ramsey
Pepe' Le Pew
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Estate taxes dont kick in till $13.6 mil lifetime are exceeded. I will try to find out from a pro and post as well.
Big Beckett!!
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Re: Unforseen or unanticipated Costs in Retirement
[Re: Ramsey]
#9024458
03/25/24 07:10 PM
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Joined: Jan 2013
Posts: 19,666
Pitchfork Predator
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Estate taxes dont kick in till $13.6 mil lifetime are exceeded. I will try to find out from a pro and post as well. True….. so if you are under the estate tax exemption amount after the ranch valuation it would only capital gains tax, if you are over the exemption it would be both…
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Re: Unforseen or unanticipated Costs in Retirement
[Re: Ramsey]
#9024459
03/25/24 07:12 PM
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Joined: Jan 2013
Posts: 19,666
Pitchfork Predator
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This is the reason most ranches get sold and leases go away because the beneficiary doesn’t want to or can’t pay the capital gains taxes and sometimes estate tax as well. Marc I am looking and cant find anything on IRS sites that differentiate at all, They even allow spouses to use step up after one dies for rental properties fir half the value. I wish there was a way to clear this up, my focus is residential real estate properties. I do not see anything that is differnt for land, but again I am not a attorney. Spouses get stepped up value on all assets until second death occurs….
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Re: Unforseen or unanticipated Costs in Retirement
[Re: Pitchfork Predator]
#9024461
03/25/24 07:13 PM
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Joined: Aug 2005
Posts: 32,028
txtrophy85
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Estate taxes dont kick in till $13.6 mil lifetime are exceeded. I will try to find out from a pro and post as well. True….. so if you are under the estate tax exemption amount after the ranch valuation it would only capital gains tax, if you are over the exemption it would be both… I’m not an attorney and this is not legal advice, but one might consider forming an LLC to put the land into and have children as managing members of the LLC.
For it is not the quarry that we truly seek, but the adventure.
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Re: Unforseen or unanticipated Costs in Retirement
[Re: DQ Kid]
#9024463
03/25/24 07:15 PM
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Joined: Jan 2013
Posts: 19,666
Pitchfork Predator
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This is the primary use of second to die life insurance….
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Re: Unforseen or unanticipated Costs in Retirement
[Re: Pitchfork Predator]
#9024464
03/25/24 07:15 PM
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Joined: Dec 2011
Posts: 14,302
Ramsey
Pepe' Le Pew
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Pepe' Le Pew
Joined: Dec 2011
Posts: 14,302 |
This is the reason most ranches get sold and leases go away because the beneficiary doesn’t want to or can’t pay the capital gains taxes and sometimes estate tax as well. Marc I am looking and cant find anything on IRS sites that differentiate at all, They even allow spouses to use step up after one dies for rental properties fir half the value. I wish there was a way to clear this up, my focus is residential real estate properties. I do not see anything that is differnt for land, but again I am not a attorney. Spouses get stepped up value on all assets until second death occurs…. Do you have reference material to point me to, Again I am not arguing, but my portfolio is affected.
Big Beckett!!
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Re: Unforseen or unanticipated Costs in Retirement
[Re: Ramsey]
#9024470
03/25/24 07:20 PM
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Joined: Jan 2013
Posts: 19,666
Pitchfork Predator
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This is the reason most ranches get sold and leases go away because the beneficiary doesn’t want to or can’t pay the capital gains taxes and sometimes estate tax as well. Marc I am looking and cant find anything on IRS sites that differentiate at all, They even allow spouses to use step up after one dies for rental properties fir half the value. I wish there was a way to clear this up, my focus is residential real estate properties. I do not see anything that is differnt for land, but again I am not a attorney. Spouses get stepped up value on all assets until second death occurs…. Do you have reference material to point me to, Again I am not arguing, but my portfolio is affected. PM Uncle Zeke
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Re: Unforseen or unanticipated Costs in Retirement
[Re: DQ Kid]
#9024476
03/25/24 07:28 PM
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Joined: Aug 2005
Posts: 32,028
txtrophy85
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Posts: 32,028 |
https://smartasset.com/taxes/capital-gains-on-inherited-propertyI’ve never once heard of a beneficiary being responsible for capital gains tax when inheriting a property. That topic had me questioning my entire career.
For it is not the quarry that we truly seek, but the adventure.
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Re: Unforseen or unanticipated Costs in Retirement
[Re: DQ Kid]
#9024479
03/25/24 07:31 PM
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Joined: Dec 2011
Posts: 14,302
Ramsey
Pepe' Le Pew
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Posts: 14,302 |
Marc- I just got short answer, basically I am covered and my daughter will recieve step up on investment property as long as it is in my individual name. He did not elaborate further as I am sure he is busy. Seems like anyone with this scenario needs counsel on their specific assets. He mentioned it depends on how the asset functions before deat another words is it in a S Copr etc.
Big Beckett!!
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Re: Unforseen or unanticipated Costs in Retirement
[Re: DQ Kid]
#9024480
03/25/24 07:32 PM
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Joined: Jul 2006
Posts: 110,803
dogcatcher
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To determine if the sale of inherited property is taxable, you must first determine your basis in the property. The basis of property inherited from a decedent is generally one of the following:
The fair market value (FMV) of the property on the date of the decedent's death (whether or not the executor of the estate files an estate tax return (Form 706, United States Estate (and Generation-Skipping Transfer) Tax Return)). The FMV of the property on the alternate valuation date, but only if the executor of the estate files an estate tax return (Form 706) and elects to use the alternate valuation on that return. See the Instructions for Form 706.
https://www.irs.gov/faqs/interest-dividends-other-types-of-income/gifts-inheritances/gifts-inheritances#:~:text=The%20basis%20of%20property%20inherited,Transfer)%20Tax%20Return)).
Combat Infantryman, the ultimate hunter where the prey shoots back. _____________"Illegitimus non carborundum est"_______________
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Re: Unforseen or unanticipated Costs in Retirement
[Re: dogcatcher]
#9024483
03/25/24 07:38 PM
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Joined: Dec 2011
Posts: 14,302
Ramsey
Pepe' Le Pew
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Pepe' Le Pew
Joined: Dec 2011
Posts: 14,302 |
To determine if the sale of inherited property is taxable, you must first determine your basis in the property. The basis of property inherited from a decedent is generally one of the following:
The fair market value (FMV) of the property on the date of the decedent's death (whether or not the executor of the estate files an estate tax return (Form 706, United States Estate (and Generation-Skipping Transfer) Tax Return)). The FMV of the property on the alternate valuation date, but only if the executor of the estate files an estate tax return (Form 706) and elects to use the alternate valuation on that return. See the Instructions for Form 706.
https://www.irs.gov/faqs/interest-dividends-other-types-of-income/gifts-inheritances/gifts-inheritances#:~:text=The%20basis%20of%20property%20inherited,Transfer)%20Tax%20Return)).
This is the IRS definition for establishing a basis or step up.
Big Beckett!!
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Re: Unforseen or unanticipated Costs in Retirement
[Re: txtrophy85]
#9024520
03/25/24 09:17 PM
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Joined: Jan 2009
Posts: 731
Sidebuster
Tracker
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Tracker
Joined: Jan 2009
Posts: 731 |
My understanding is that you pay capital gains on the difference of value between when you inherit property and when and if you sell it.
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Re: Unforseen or unanticipated Costs in Retirement
[Re: Sidebuster]
#9024523
03/25/24 09:22 PM
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Joined: Mar 2010
Posts: 12,360
ntxtrapper
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My understanding is that you pay capital gains on the difference of value between when you inherit property and when and if you sell it. Yes.
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Re: Unforseen or unanticipated Costs in Retirement
[Re: ntxtrapper]
#9024556
03/25/24 10:36 PM
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Joined: Apr 2013
Posts: 8,556
freerange
THF Trophy Hunter
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THF Trophy Hunter
Joined: Apr 2013
Posts: 8,556 |
My understanding is that you pay capital gains on the difference of value between when you inherit property and when and if you sell it. Yes. My understanding as well.
At some point in life its time to quit chasing the pot of gold and just enjoy the rainbow. FR Keep your gratitude higher than your expectations. RWH
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Re: Unforseen or unanticipated Costs in Retirement
[Re: freerange]
#9024595
03/25/24 11:27 PM
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Joined: Dec 2011
Posts: 14,302
Ramsey
Pepe' Le Pew
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Pepe' Le Pew
Joined: Dec 2011
Posts: 14,302 |
My understanding is that you pay capital gains on the difference of value between when you inherit property and when and if you sell it. Yes. My understanding as well. I confirmed with atty and advisor, this is correct as long as it is not in a irovacable trust. I do not know the law for LLC or corporation structures.
Big Beckett!!
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Re: Unforseen or unanticipated Costs in Retirement
[Re: DQ Kid]
#9024607
03/25/24 11:49 PM
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Joined: Feb 2012
Posts: 10,532
DQ Kid
OP
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OP
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This one took an interesting twist with the land inheritance angle; Arndt and Berta may have some land back in Bavaria but not here in the states...
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Re: Unforseen or unanticipated Costs in Retirement
[Re: DQ Kid]
#9024623
03/26/24 12:05 AM
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Joined: Jun 2007
Posts: 1,895
blanked
Pro Tracker
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Pro Tracker
Joined: Jun 2007
Posts: 1,895 |
I think pro financial advisors are the problem. There way to conservative and there out rageous fees. 60 is still too young to rely on bonds heavily
Get rid of the finance guy. Put what you need for 3 or 4 years in CDs. The rest in a S and P 500 tracking fund
Last edited by blanked; 03/26/24 12:08 AM.
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Re: Unforseen or unanticipated Costs in Retirement
[Re: blanked]
#9024652
03/26/24 12:45 AM
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Joined: Aug 2005
Posts: 32,028
txtrophy85
THF Celebrity
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THF Celebrity
Joined: Aug 2005
Posts: 32,028 |
I think pro financial advisors are the problem. There way to conservative and there out rageous fees. 60 is still too young to rely on bonds heavily
Get rid of the finance guy. Put what you need for 3 or 4 years in CDs. The rest in a S and P 500 tracking fund So you’re saying that financial/investment pros are too conservative yet you recommend putting money in CD’s which are currently paying a 5.5% rate…at best? That’s pretty conservative, only thing more is earning a point or two interest on your savings account.
For it is not the quarry that we truly seek, but the adventure.
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Re: Unforseen or unanticipated Costs in Retirement
[Re: DQ Kid]
#9024683
03/26/24 01:45 AM
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Joined: Jun 2006
Posts: 8,364
Dave Davidson
THF Trophy Hunter
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THF Trophy Hunter
Joined: Jun 2006
Posts: 8,364 |
Fixed income investments aren’t all that great when thePrez and Congress loot the economy causing high inflation.
Without a sense of urgency, nothing ever happens.
Boy, if I say "sic em", you'd better look for something to bite. Sam Shelley, Rancher Muleshoe Texas 1892-1985 RIP
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Re: Unforseen or unanticipated Costs in Retirement
[Re: txtrophy85]
#9024688
03/26/24 02:05 AM
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Joined: Jun 2007
Posts: 1,895
blanked
Pro Tracker
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Pro Tracker
Joined: Jun 2007
Posts: 1,895 |
I think pro financial advisors are the problem. There way to conservative and there out rageous fees. 60 is still too young to rely on bonds heavily
Get rid of the finance guy. Put what you need for 3 or 4 years in CDs. The rest in a S and P 500 tracking fund So you’re saying that financial/investment pros are too conservative yet you recommend putting money in CD’s which are currently paying a 5.5% rate…at best? That’s pretty conservative, only thing more is earning a point or two interest on your savings account. I said 3 or 4 years worth not the whole thing. That still leaves about 85% of your portfolio keeping up with the market so you never dip into your principle. These advisors will have 60% of the portfolio in bonds. Major difference
Last edited by blanked; 03/26/24 02:11 AM.
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