AboutRichard Fritzler Expertise I am in the business of tax planning for business owners. Our company helps business owners structure so that they can be reduce the taxes that they owe, making them far more profitable.
Experience Since 1986 I have been helping successful business owners reduce taxes, protect assets, and limit their liability. The company is Owelesstax, incorporated at www.owelesstax.com
Organizations National Small Business Owners Association.
Nevada Association of Listed Resident Agents.
Citizens Legal Association
The Business Owners Institute
Publications Contributing author to "The Corporate Standard Newsletter".
I am also a writer for an email newsletter about business
Googlegroups/Successfulbusiness
I am also an Expert in the areas of Tax Law, Retirement Planning, and Estate tax issues.
Expert: Richard Fritzler Date: 8/17/2007 Subject: Tax on sale of house
Question QUESTION: My mother is 86 years old. She lives with my sister. Sometime within the next two years I am sure that my mother will need full time care during the day when my sister is working. My mother still owns her house and is still considered as her residence although she stays with my sister and the house is empty.She has a monthly income of $2200 from SS and retirement income Presently someone wants to buy the land that the house is on for $1,000,000. My question is how much income tax will she have to pay from the sale. Is there any we can do before the sale to reduce the taxes?
ANSWER: The big items:
$250,000 of that sale would be exempt from Federal taxes, assuming that she has lived in that house for two out of the last 5 years.
The rest would be a long term gain, and the federal tax rate would be 15%.
You would also need to consider any State Tax Rates.
Richard Fritzler
---------- FOLLOW-UP ----------
QUESTION: Would doing a "structured sale" be something we should consider?
Answer What State are we talking about?
A "Structured Sale" would not reduce the overall tax, and If she received even a small percentage of the purchase price up front the IRS wants ALL the Taxes paid first.
At $750,000 of taxable gain it is worth considering alternatives. Most conventional alternatives do not actually reduce the taxes, they simply postpone the taxes.
There is a way to "Step Up Basis" on the property, resulting in no tax when it sells. BUT it is not cheap, and not easy. It will result in you having more of the money to spend, than not doing it. So if you are really interested call me.
Richard Fritzler
www.owelesstax.com
phone 800 590-6612
