Jane_Doe
Recycles dryer sheets
Hi Guys!
Fascinating subject. Want to put in my 2 cents worth. I think some of this is comparing apples and oranges. In our situation, DH and I own a piece of commercial rental property that has dramatically increased in value over the last couple of years and looks to do even better in the next couple of years due to local development projects. When we sell (this is our plan) we will pay the capital gains at that point. The money left over (NET) will be what we invest to live upon for our ER. Now, not figuring in any capital gains on top of that NET amount - i.e., what if DH and I drop dead (God forbid) the next day after that - our two daughters will end up paying an inheritance (estate) tax on that money that has already been taxed. [Yes, I plan on figuring out an "esate" plan prior to all this to avoid this scenario.] Hypothetically, this could happen to a family and really is a double taxation.
Granted, DH and I do not want or plan to just hand over a sum of money to our kids that they may not be ready to handle, but right now if we both went tomorrow it would be a mess for them. [Additional note - FYI, my dad and sister are capable of helping a lot in this case. Dad is executor of our wills.] Luckily we have always been real estate poor (money on paper but not in hand), so they (kids) have always worked for what they want and have seen how hard we (mom & dad) work for what we have - so I guess they would do better than the average as stewards of their money. But still, back to my original point, is it fair for a family to pay taxes twice on the same money? I think not.
Interested to hear replies and rebuttals!
Jane
Fascinating subject. Want to put in my 2 cents worth. I think some of this is comparing apples and oranges. In our situation, DH and I own a piece of commercial rental property that has dramatically increased in value over the last couple of years and looks to do even better in the next couple of years due to local development projects. When we sell (this is our plan) we will pay the capital gains at that point. The money left over (NET) will be what we invest to live upon for our ER. Now, not figuring in any capital gains on top of that NET amount - i.e., what if DH and I drop dead (God forbid) the next day after that - our two daughters will end up paying an inheritance (estate) tax on that money that has already been taxed. [Yes, I plan on figuring out an "esate" plan prior to all this to avoid this scenario.] Hypothetically, this could happen to a family and really is a double taxation.
Granted, DH and I do not want or plan to just hand over a sum of money to our kids that they may not be ready to handle, but right now if we both went tomorrow it would be a mess for them. [Additional note - FYI, my dad and sister are capable of helping a lot in this case. Dad is executor of our wills.] Luckily we have always been real estate poor (money on paper but not in hand), so they (kids) have always worked for what they want and have seen how hard we (mom & dad) work for what we have - so I guess they would do better than the average as stewards of their money. But still, back to my original point, is it fair for a family to pay taxes twice on the same money? I think not.
Interested to hear replies and rebuttals!
Jane