Iowa 136a - What will is go for?

[Tree Spud]

I sold beach property last spring and bought another immediately. If I held out for a price drop I'd be priced out of the area. Realtor called last week and said what I bought is worth 25% more in a year. This can't continue. But I'm not getting priced out so I'll hold and see where the cards fall.

We just bought a beach front property 18 months ago ... crazy but realtor gave us a current market estimate of 2.5 times what we paid.

 

[williams111]

Also loosing a million to capital gains taxes in a sale like that would hurt my soul just a little bit.

I would shed a tear selling a farm that's been in their family for decades...they'll never get it back.

 

[Bill]

I would shed a tear selling a farm that's been in their family for decades...they'll never get it back.

Never!

And that’s the dilemma. Buddy of mine was left a beach house with his siblings. It was their grandfather’s then their mothers.

They couldn’t agree on anything. Sold it in 2010 for $700k. 1 house from the ocean.

Today it’s valued at 1.8. None of them will ever have a beach house again.

 

[bwoods11]

I saw a guy sell his farm (age 93)for around 1 million. He had bought it for 250k… so 750k in capital gains . I don’t see any way he can come out ahead after paying the capital gains! Unless he’s Benjamin Button!

 

[roosterstraw]

I saw a guy sell his farm (age 93)for around 1 million. He had bought it for 250k… so 750k in capital gains . I don’t see any way he can come out ahead after paying the capital gains! Unless he’s Benjamin Button!

He would be netting around 640k assuming it’s taxed at 15% and he didn’t do any improvements to the farm.

 

[b116757]

I believe if he lived on the place and was married he would pay no capital gains on $500,000 of that sale but I am far from a tax guru.

 

[H20fwler]

There is a 400 acre tract, 260 rough tillable 140 timber/pasture that was just listed, the mother that owned it passed away and the kids are selling it. The are asking 4.5 mil. $11,250/acre. It has been nuts around here what land prices have done. How can this continue? I'm glad I got my little chunk when I did.

That is exactly what has happened in my area in the last two years.
Rough ground that can only be used for hunting/recreation is going for $10K and up now.
It is crazy to me that people are paying that, the county is loving the tax base though.

 

[bwoods11]

He would be netting around 640k assuming it’s taxed at 15% and he didn’t do any improvements to the farm.

I should have been more clear . So this property had around $30,000 in income.

In this case he will pay $125-150k in capital gains.

If he died and passed it in to his sons, they get the stepped up basis . Plus still own it and have the income.

The math is terrible as a family. Unless he absolutely needed the money. I know in this case he didn’t.

 

[b116757]

He was probably liquidating assets for estate planning.

 

[Buckly]

He would be netting around 640k assuming it’s taxed at 15% and he didn’t do any improvements to the farm.

In NY you can add another at least 8% for the State. It’s Considered ordinary income Here.

 

[bwoods11]

He was probably liquidating assets for estate planning.

I don’t think so… but I’m not sure. I could not add it up in any scenario where he “should” sell? Unless he lived well into 100.

Plus what would he (age 90s)invest in that gave him a 3% plus return with relative safety ?