Baby boomers complaining about paying capital gains tax......

[OG Goat Holder]

Boomers are not moving out of their big homes. Here’s why

After 33 years and four children, Baby Boomers Marta and Octavian Dragos say they feel trapped in what was once their dream home in El Cerrito, California.

finance.yahoo.com

Are you kidding me? Buy a house for 100K in the 90s, sell it for 2M and complaining about paying 450K in taxes? Even with realtor fees and all that, that's a 9% investment over 30 years. And now you want more, just because you want to take advantage of big numbers?

The entitlement has reached a new level. I'm supposed to feel sorry for them for having to stay where they are?

 

[DoggieDaddy13]

Boomers are not moving out of their big homes. Here’s why

After 33 years and four children, Baby Boomers Marta and Octavian Dragos say they feel trapped in what was once their dream home in El Cerrito, California.

finance.yahoo.com

Are you kidding me? Buy a house for 100K in the 90s, sell it for 2M and complaining about paying 450K in taxes? Even with realtor fees and all that, that's a 9% investment over 30 years. And now you want more?

The entitlement has reached a new level.

Their expenses have gone up considerably in El Cerrito, I'm sure. Don't be a hater player, Goat.

People who are wise enough to invest well should not be punished for being smarter than the rest. In fact, we should be giving them more tax breaks and let it trickle down to all the losers.

 

[patdog]

Their expenses have gone up considerably in El Cerrito, I'm sure. Don't be a hater player, Goat.

People who are wise enough to invest well should not be punished for being smarter than the rest. In fact, we should be giving them more tax breaks and let it trickle down to all the losers.

A 20% capital gain tax is a huge tax break. The issue here is the limitation on gain exclusion for sale of your residence. Makes it hard to move without significantly downsizing if you're going to have to pay $450,000 in income taxes. It's hard to feel too sorry for someone sitting on a $1,900,000 gain on their house though.

 

[OG Goat Holder]

Their expenses have gone up considerably in El Cerrito, I'm sure. Don't be a hater player, Goat.

People who are wise enough to invest well should not be punished for being smarter than the rest. In fact, we should be giving them more tax breaks and let it trickle down to all the losers.

I c wut u did there, or are trying to do.....but that's not my angle and not biting on that.

Just don't bltch about it - is my point. Don't act as if this is some hardship for you.

 

[pseudonym]

Trust me, the tax code being what it is, you do not want to be rich right now.

 

[OG Goat Holder]

A 20% capital gain tax is a huge tax break. The issue here is the limitation on gain exclusion for sale of your residence. Makes it hard to move without significantly downsizing if you're going to have to pay $450,000 in income taxes. It's hard to feel too sorry for someone sitting on a $1,900,000 gain on their house though.

It does, if they stay in their area. But to me, if they want to stay in their area, well.....you have a paid for house. Stay there and leave it to someone in an inheritance or something.

Then some of them are saying that their gain was something they counted on for retirement. Are you kidding me, that's a load of horse shlt. No way they anticipated this level of gain.

Oh, you didn't fund your retirement? Either pay the 450K or go apply at Home Depot. I actually saw an old woman working at Bojangles the other day and seemed to be having a good time.

 

[PooPopsBaldHead]

There's a simple workaround:

They should get a reverse mortgage and take the payments and put them into a tax swapped Roth IRA and use an early retirement provision to make payments to themselves in a blind trust through a Delaware LLC and then use those payments to fund a new 1031 exchange to purchase a new property (or properties) in a portfolio loan that is held by another trust through an additional Nevada LLC.

Easy peasy.

 

[OG Goat Holder]

Trust me, the tax code being what it is, you do not want to be rich right now.

Yeah man, being rich totally sucks.

I'm as conservative as they come but this whole idea that you are getting 17ed for paying taxes really is a baffling thing.

 

[dorndawg]

Trust me, the tax code being what it is, you do not want to be rich right now.

LOL

 

[dorndawg]

There's a simple workaround:

They should get a reverse mortgage and take the payments and put them into a tax swapped Roth IRA and use an early retirement provision to make payments to themselves in a blind trust through a Delaware LLC and then use those payments to fund a new 1031 exchange to purchase a new property (or properties) in a portfolio loan that is held by another trust through an additional Nevada LLC.

Easy peasy.

How exactly are you planning to do this without including unmarked bearer bonds?

 

[ronpolk]

Trust me, the tax code being what it is, you do not want to be rich right now.

Gotta disagree with you there. I’d rather pay more taxes and be rich… any rich person here tired of being rich and want to give me your wealth and tax burden, I’m sure we can work something out.

 

[rynodawg]

Don’t feel sorry for the people in the article, but seems like we could just increase the primary home exclusion up to $1M ($500K single) due to inflation. It’s been $500K for a long time. That would solve the vast majority of boomer home sales.

 

[The Peeper]

Boomers are not moving out of their big homes. Here’s why

After 33 years and four children, Baby Boomers Marta and Octavian Dragos say they feel trapped in what was once their dream home in El Cerrito, California.

finance.yahoo.com

Are you kidding me? Buy a house for 100K in the 90s, sell it for 2M and complaining about paying 450K in taxes? Even with realtor fees and all that, that's a 9% investment over 30 years. And now you want more, just because you want to take advantage of big numbers?

The entitlement has reached a new level. I'm supposed to feel sorry for them for having to stay where they are?

Entitlement? If they sell for $2Mil and pay almost half a mil in taxes they are left w/ roughly $1.5M and now have to find a place to live in El Cerrito i.e. San Francisco Bay area for that $1.5M Go look up real estate prices in the Bay area Goat and see what you can buy there for that. HINT: $1.5 Mil won't buy you much of anything there.

Its not just California. My wife and I wanted a small house in Starkville when we bought 9 years ago. Those were typically being swiped up by investors and people wanting game day homes. We ultimately bought a 5BR just outside of Starkville for about the same as we could buy a 2BR in town. Now that we want to sell it the market has jumped crazily and so have mortgage rates. I don't think we would have any problem selling ours at all for a nice profit, but then what? Go buy something much smaller for the same price plus maybe a mortgage at 7.25% while I'm at 3.2% now?

 

[PooPopsBaldHead]

How exactly are you planning to do this without including unmarked bearer bonds?

Bitcoin of course.

 

[OG Goat Holder]

Its not just California. My wife and I wanted a small house in Starkville when we bought 9 years ago. Those were typically being swiped up by investors and people wanting game day homes. We ultimately bought a 5BR just outside of Starkville for about the same as we could buy a 2BR in town. Now that we want to sell it the market has jumped crazily and so have mortgage rates. I don't think we would have any problem selling ours at all for a nice profit, but then what? Go buy something much smaller for the same price plus maybe a mortgage at 7.25% while I'm at 3.2% now?

Are you expecting sympathy for this? Wow.

You don't have to do it. You've had good fortune. Don't cry to people about it like something bad has happened to you.

 

[WilCoDawg]

It’s an antiquated law that needs to be revisited. And to automatically assume those people are that rich just because the value of their home is so outrageous is pretty ignorant. Caveat: I didn’t read the article so I’m not informed on the subjects, but there are people who aren’t in the 1% that are also victims to this tax. It’s a law written by the 1% to penalize those trying to achieve a better status, won in the RE market, and are now being penalized. Just because some people made a wise investment, they shouldn’t be subjected to the tax if they are turning around to make another home purchase.

If it was truly an investment property, then sure, tax away. But subjecting a homeowner who is either going to upgrade or downgrade? Nah, man. That’s actually greedy on the gubment’s part.

 

[Bulldog45]

Don’t those greedy folks know Zelensky and millions of illegal immigrants deserve their money more than they do?

 

[Shmuley]

Boomers are not moving out of their big homes. Here’s why

After 33 years and four children, Baby Boomers Marta and Octavian Dragos say they feel trapped in what was once their dream home in El Cerrito, California.

finance.yahoo.com

Are you kidding me? Buy a house for 100K in the 90s, sell it for 2M and complaining about paying 450K in taxes? Even with realtor fees and all that, that's a 9% investment over 30 years. And now you want more, just because you want to take advantage of big numbers?

The entitlement has reached a new level. I'm supposed to feel sorry for them for having to stay where they are?

So, I'm supposed to feel okay about paying capital gains on after tax investment dollars? Color me less than persuaded.

 

[GloryDawg]

Just do a reverse mortgage, use that equity to buy a smaller home somewhere else and rent your home out. You get smaller home. No tax on a reverse mortgage unless you end up selling it. Just live in your new home, collect the rent out of your home that has a reverse mortgage, and when both spouses die just tell your kids to let the house go back to the bank.

 

[DesotoCountyDawg]

Estate taxes suck in the farming community.

 

[Chesusdog]

Trust me, the tax code being what it is, you do not want to be rich right now.

It's gotta beat struggling through the lower middle class.

 

[TaleofTwoDogs]

Are you expecting sympathy for this? Wow.

You don't have to do it. You've had good fortune. Don't cry to people about it like something bad has happened to you.

Stating reality and facts is not an op-ed article. Learn the difference and you will be more wiser for it.

 

[dorndawg]

It’s an antiquated law that needs to be revisited. And to automatically assume those people are that rich just because the value of their home is so outrageous is pretty ignorant. Caveat: I didn’t read the article so I’m not informed on the subjects, but there are people who aren’t in the 1% that are also victims to this tax. It’s a law written by the 1% to penalize those trying to achieve a better status, won in the RE market, and are now being penalized. Just because some people made a wise investment, they shouldn’t be subjected to the tax if they are turning around to make another home purchase.

If it was truly an investment property, then sure, tax away. But subjecting a homeowner who is either going to upgrade or downgrade? Nah, man. That’s actually greedy on the gubment’s part.

Almost seems like we could work up some kind of 1031 for residential homes that both didn't penalize the homeowner as harshly, and helped facilitate a bit more housing stock availability. I'd think geographic locations where this is most needed would have a strong overlap.

 

[PooPopsBaldHead]

The problem with the whole deal is that the current primary home capital gains exclusion law was written in 1997. So in 1997 married couples could exclude up toe $500,000 of a primary residence profits from capital gains taxes. In 2024 that number is $500,000. I'm not a math wizard, but I have a feeling that $500,000 in 2024 is not equal to the same dollar amount in 1997... Particularly when we are talking about housing. You could raise that number to $1.5 million today and it would have the same effect now that it did in 1997.

 

[bolddogge]

I'm closing in on the same situation. I was looking ahead when I purchased my house 20 years ago. Bought as much as I could afford in a location that was trending up in all positive measures. I paid it off early and now it's worth about 5-6 times the purchase price. I made a good plan and executed it to perfection. I always expected Uncle Sam to want his share but was hoping his chunk wouldn't be so large. It's still a very nice area. So, I'm staying put... at least until the tax rates change.

 

[DesotoCountyDawg]

The problem with the whole deal is that the current primary home capital gains exclusion law was written in 1997. So in 1997 married couples could exclude up toe $500,000 of a primary residence profits from capital gains taxes. In 2024 that number is $500,000. I'm not a math wizard, but I have a feeling that $500,000 in 2024 is not equal to the same dollar amount in 1997... Particularly when we are talking about housing. You could raise that number to $1.5 million today and it would have the same effect now that it did in 1997.

 

[The Peeper]

Are you expecting sympathy for this? Wow.

You don't have to do it. You've had good fortune. Don't cry to people about it like something bad has happened to you.

Can you not read between the lines? I'm going to be buying a much smaller house than I have now for more. If I mortgage it I'll be paying ~4% more for that too. You don't consider that as "something bad has happened"?

What about when Uncle Sloe Joe tanks the economy even more and the housing market bubble bursts which most agree is inevitable? Then I have a much smaller asset in square footage when the time comes to sell and then I really lose. I'm done w/ you, go to Reddit if you need more info and look for the Subreddit "explain it to me like I'm 5" and ask them

 

[pseudonym]

Bitcoin of course.

Because fiat money is broken, investors use assets like real estate, the stock market, fine art, etc. as alternate forms of money, specifically money's role as a store of value. This has resulted in a monetary premium in these asset classes.

The problem is that these assets are not good forms of money, even though they preserve purchasing power better than fiat money. What if you could achieve the same (or better) capital preservation as a rental property without having to:

• pay property taxes
• pay for repairs
• deal with tenants
• hold an illiquid asset (try selling your rental property by EOD)
• hold a non-fungible asset (1 house ≠ 1 house)
• pay high transaction fees (closing costs)
• hold an asset that is impossible to physically move (if you move states, you're selling your rental properties or dealing with managing properties from afar)
• buy a high minimum investment asset

As bitcoin adoption increases, it becomes a more and more realistic store of value alternative to asset classes like real estate. Compare:

• no property taxes
• no repair costs, minimal maintenance costs (replace a signing device every two years or so, rent a safe deposit box to store seed phrase, etc.)
• no counter-parties (assuming you self-custody and avoid products like ETFs)
• extremely liquid: trades 24/7; launched in 2009, bitcoin has already traded more hours than the S&P 500)
• fungible (1 BTC = 1 BTC)
• not difficult to find trading platforms that offer 100 bps or less trading fees
• can move any amount of value globally, instantly
• no minimum investment (you can buy $10 or $10 billion of bitcoin)
• I'm probably leaving out other advantages, but the above is a good starting point.

The primary advantage of rental property over bitcoin is cash flow. bitcoin doesn't have a cash flow. However, if you are looking for a store of value, the gains of bitcoin exceed those of real estate over the long term (5+ years), including real estate's cash flow.

As more investors figure this out, the monetary premium of real estate will flow to bitcoin. This is a good thing because the monetary properties of bitcoin are superior to real estate. It is also a good thing because it makes real estate more affordable for the primary use of real estate: putting a roof over your head! This is a very big deal for first-time home buyers who are competing to buy a residence with people buying a second, third, or fourth house.

 

[patdog]

Trust me, the tax code being what it is, you do not want to be rich right now.

I think I’d like to try it.

 

[DesotoCountyDawg]

Can you not read between the lines? I'm going to be buying a much smaller house than I have now for more. If I mortgage it I'll be paying ~4% more for that too. You don't consider that as "something bad has happened"?

What about when Uncle Sloe Joe tanks the economy even more and the housing market bubble bursts which most agree is inevitable? Then I have a much smaller asset in square footage when the time comes to sell and then I really lose. I'm done w/ you, go to Reddit if you need more info and look for the Subreddit "explain it to me like I'm 5" and ask them

The golden handcuff.

My sister in law is in a similar situation.

 

[IBleedMaroonDawg]

Boomers are not moving out of their big homes. Here’s why

After 33 years and four children, Baby Boomers Marta and Octavian Dragos say they feel trapped in what was once their dream home in El Cerrito, California.

finance.yahoo.com

Are you kidding me? Buy a house for 100K in the 90s, sell it for 2M and complaining about paying 450K in taxes? Even with realtor fees and all that, that's a 9% investment over 30 years. And now you want more, just because you want to take advantage of big numbers?

The entitlement has reached a new level. I'm supposed to feel sorry for them for having to stay where they are?

 

[IBleedMaroonDawg]

They want it all.

 

[thatsbaseball]

Boomers are not moving out of their big homes. Here’s why

After 33 years and four children, Baby Boomers Marta and Octavian Dragos say they feel trapped in what was once their dream home in El Cerrito, California.

finance.yahoo.com

Are you kidding me? Buy a house for 100K in the 90s, sell it for 2M and complaining about paying 450K in taxes? Even with realtor fees and all that, that's a 9% investment over 30 years. And now you want more, just because you want to take advantage of big numbers?

The entitlement has reached a new level. I'm supposed to feel sorry for them for having to stay where they are?

Goat you need to wake up and smell the flowers if you're shocked by Americans of any age group wanting "more". In case you haven't noticed we are all greedy Mofos .

 

[OG Goat Holder]

So, I'm supposed to feel okay about paying capital gains on after tax investment dollars? Color me less than persuaded.

Isn't this standard operating procedure on any investment?

 

[OG Goat Holder]

Can you not read between the lines? I'm going to be buying a much smaller house than I have now for more. If I mortgage it I'll be paying ~4% more for that too. You don't consider that as "something bad has happened"?

What about when Uncle Sloe Joe tanks the economy even more and the housing market bubble bursts which most agree is inevitable? Then I have a much smaller asset in square footage when the time comes to sell and then I really lose. I'm done w/ you, go to Reddit if you need more info and look for the Subreddit "explain it to me like I'm 5" and ask them

I think you're the one who can't see between the lines. If an economic slowdown happens, that affects all investments. So no, you've been fortunate - not screwed over. Really unbelievable, the mindset you have.

And not sure what you're thinking about as far as a slowdown anyway, most agree that it's only the interest rates causing the slowdown currently. If they ever lower again, values are going up even further.

 

[CochiseCowbell]

The golden handcuff.

Is this a euphemism?

 

[DesotoCountyDawg]

Is this a euphemism?

Golden Handcuffs: Why Many Americans Are Prisoners in Their Own Home

The idea that homeowners may be wearing golden handcuffs isn't new, but it's probably more true now with the state of the housing market.

investorplace.com

 

[mcdawg22]

Boomers are not moving out of their big homes. Here’s why

After 33 years and four children, Baby Boomers Marta and Octavian Dragos say they feel trapped in what was once their dream home in El Cerrito, California.

finance.yahoo.com

Are you kidding me? Buy a house for 100K in the 90s, sell it for 2M and complaining about paying 450K in taxes? Even with realtor fees and all that, that's a 9% investment over 30 years. And now you want more, just because you want to take advantage of big numbers?

The entitlement has reached a new level. I'm supposed to feel sorry for them for having to stay where they are?

He should ask himself does he trust his wife? Andy Dufresne told me you can avoid paying taxes if you trust your wife.

 

[dorndawg]

I'm closing in on the same situation. I was looking ahead when I purchased my house 20 years ago. Bought as much as I could afford in a location that was trending up in all positive measures. I paid it off early and now it's worth about 5-6 times the purchase price. I made a good plan and executed it to perfection. I always expected Uncle Sam to want his share but was hoping his chunk wouldn't be so large. It's still a very nice area. So, I'm staying put... at least until the tax rates change.

Nothing changed in 20 years with regards to the capital gains tax, so I'm not sure how that wouldn't factor in to a "good plan executed to perfection". I completely get not wanting to pay a lot of taxes but it's not as though some surprise was sprung upon you. Hope isn't a plan.

 

[dorndawg]

Because fiat money is broken, investors use assets like real estate, the stock market, fine art, etc. alternate forms of money, specifically money's role as a store of value. This has resulted in a monetary premium in these asset classes.

The problem is that these assets are not good forms of money, even though they preserve purchasing power better than fiat money. What if you could achieve the same (or better) capital preservation as a rental property without having to:

• pay property taxes
• pay for repairs
• deal with tenants
• hold an illiquid asset (try selling your rental property by EOD)
• hold a non-fungible asset (1 house ≠ 1 house)
• pay high transaction fees (closing costs)
• hold an asset that is impossible to physically move (if you move states, you're selling your rental properties or dealing with managing properties from afar)
• buy a high minimum investment asset

As bitcoin adoption increases, it becomes a more and more realistic store of value alternative to asset classes like real estate. Compare:

• no property taxes
• no repair costs, minimal maintenance costs (replace a signing device every two years or so, rent a safe deposit box to store seed phrase, etc.)
• no counter-parties (assuming you self-custody and avoid products like ETFs)
• extremely liquid: trades 24/7; launched in 2009, bitcoin has already traded more hours than the S&P 500)
• fungible (1 BTC = 1 BTC)
• not difficult to find trading platforms that offer 100 bps or less trading fees
• can move any amount of value globally, instantly
• no minimum investment (you can buy $10 or $10 billion of bitcoin)
• I'm probably leaving out other advantages, but the above is a good starting point.

The primary advantage of rental property over bitcoin is cash flow. bitcoin doesn't have a cash flow. However, if you are looking for a store of value, the gains of bitcoin exceed those of real estate over the long term (5+ years), including real estate's cash flow.

As more investors figure this out, the monetary premium of real estate will flow to bitcoin. This is a good thing because the monetary properties of bitcoin are superior to real estate. It is also a good thing because it makes real estate more affordable for the primary use of real estate: putting a roof over your head! This is a very big deal for first-time home buyers who are competing to buy a residence with people buying a second, third, or fourth house.

I'd really been missing the funny money brigade around here