Posted on 07/31/2021 8:28:10 AM PDT by karpov
VERSAILLES, Ky.—Five brick apartment buildings in this horse-country town make up Paul Settle’s retirement nest egg. He purchased the complex 27 years ago and has spent almost every day since tidying the grounds, repairing garbage disposals and collecting rent checks.
Mr. Settle, 64 years old, pays himself about $75,000 a year. The idea was always to one day sell and retire off the proceeds.
But now his plans are on hold. The Biden administration’s tax proposal would increase the capital-gains taxes Mr. Settle would pay on the sale of the apartments, which he expects to fetch over $2 million. Mr. Settle’s tax adviser estimates the changes could halve his after-tax proceeds to about $400,000 after paying off the mortgage.
“I’m in limbo,” he said.
Democrats argue for taxing wealth like work and are seeking to equalize the top rates on capital income and labor. But the line between rich investors and middle-class earners isn’t always so clear. Some, like Mr. Settle, fall into both categories.
The Biden plan would increase the top capital-gains tax rate to 43.4% from 23.8% for those earning over $1 million. In any given year, only a sliver of taxpayers fall into this top bracket. Of taxpayers who filed Schedule D, the form for reporting capital gains and losses, only 2.7% had adjusted gross income of $1 million or more in 2018, according to a Tax Policy Center analysis of Internal Revenue Service data.
While many of the wealthiest people in the world are in this group, others more closely resemble Mr. Settle: They usually make less than $1 million, but capital gains from the sale of a property or business pushes them over that threshold for one year only.
(Excerpt) Read more at wsj.com ...
Simple. The property he owns for rentals can easily hit 1 mil.
Lifestyles Unlimited. Texas based. Look them up. Not gat rich quick, but good cash flow. Looking into it myself.
Plank #1 of the Communist Manifesto: Abolition of private property rights.
Plank #2: A highly graduated income tax.
http://www.laissez-fairerepublic.com/TenPlanks.html
Sell a 1/2 interest for now. The rest in another tax year.
In inflated dollars.
In a couple years, YOU will be in the millionaires club!
Five brick apartment buildings
The details are important and there is much misinformation here.
Anyway, simple solution, don’t sell all the buildings the same year..................................
A decent lawyer could structure things with some semi-complex documtation that would keep the income lower over what ever period of time was needed. Just like a rich person would.
I was thinking the same thing. Lots of ways to be creative about these things.
Makes me wonder why our government selects Blackrock to give trillions of our dollars to invest at no risk.
Why does our government not loan boycott, Inc. (my username, Inc.) trillions?
The Chairman of Blackrock has become a billionaire. Why do they not just give all those funds to others to invest? Are they that generous with conservative companies? I am thinking not.
...Biden plan would increase the top capital-gains tax rate to 43.4% from 23.8% for those earning over $1 million.
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One of the reasons FedGov *wants* inflation. A home purchased decades ago for $100K will be “worth” $1M with inflated worthless dollars. Then the government gets to confiscate half from the “wealthy”.
The only plus to this absurdity is that if they’re greedy and stupid enough to implement such a tax, it will collapse the R/E market, and the rest of the economy. With a bit of luck and a lot of prayer, that will wash out Biden and his puppet masters in 2024.
They are buying up as much real estate as they can and will pay back the loans with dollars that have been inflated to oblvion.
He should get out of it now. Given the extreme hatred commies have for landlords, high capital gains rates might be the least of his worries.
Since we are on the subject of rental properties, today is the day the deferred rent comes due. I think this is going to be quite a show.
Correct. In our business, there’s a saying “ a tax attorney is more important than a criminal defense attorney”.
democrats fully intend to confiscate accumulated wealth. There is no doubt about that. They will not allow anyone to call it confiscation (social media will help enforce).
They will take anything you have made or built. They will call it a tax. It will not be a tax. It will be confiscation. (Doesn’t matter if they force you to sell it to pay what they want in money. It’s still confiscation.)
The democrat party is the leading edge of the final thrust to turn this country communist (you will be forbidden to call it communist. Social media will help you comply.)
anyone that sells their home in Southern California by the ocean in in jeopardy of paying this capital gains tax rate. So much for putting any remains proceeds towards a healthy/decent retirement.
How could he possibly have known the democrats he votes for would want to raise his taxes? /s
Seems like Biden is doing this to benefit his wealthy corporate backers. Like I don’t know, Blackrock, which will find bargains on rental properties all over.
They are buying up as much real estate as they can and will pay back the loans with dollars that have been inflated to oblvion.
So true.
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