Join Early Retirement Today
Reply
 
Thread Tools Display Modes
Step-up basis
Old 02-23-2021, 04:44 PM   #81
Recycles dryer sheets
 
Join Date: Jan 2020
Location: Marysville
Posts: 82
Step-up basis

Am I misunderstanding how that works? So, If President Biden takes away the stepped-up basis provision, and if say your mom dies and you inherit a house your parents bought for $50k in 1970, then you sell it for $400k, that's $350k capital gains (minus deductible and carryover losses or what have you)



BUT... If you die, your spouse still owns the house, so if he or she sells it the basis is whatever you paid for it anyway, just as it would be if you were still alive, right?



It would be nice for both parties in a marriage to have an interest in finances and could help plan... But I think usually only one person is handling it. I am that person, but it would be nice to have someone to help figure things out, like we do with the crossword puzzle.
JohnRM is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 02-23-2021, 06:51 PM   #82
Full time employment: Posting here.
 
Join Date: May 2009
Location: Ottawa and Fort Myers
Posts: 778
After a lifetime of responsible behavior, dont drop the ball on your last act.

Do the footwork of finding the best firm and best manager in town to take things over if you don’t wake up one morning.

I would overweight fraud risk management, a firm with supervised management of advisors, and the risk of close relations, children, taking advantage of the indifferent spouse.

You also have to manage the risk of a long lived parent outliving you, if you are responsible for their affairs.

It involves an expensive will done in cooperation with Trust Company lawyers.
Kroeran is offline   Reply With Quote
Old 02-23-2021, 07:24 PM   #83
Administrator
Gumby's Avatar
 
Join Date: Apr 2006
Posts: 22,974
Quote:
Originally Posted by JohnRM View Post
Am I misunderstanding how that works? So, If President Biden takes away the stepped-up basis provision,....
I really must take issue with this part of your post. It is Congress that writes and passes tax laws, including any law that would affect the step up basis on inherited assets. The President can only sign or veto what Congress passes. And, in any event, I am unaware that the Biden Administration is advocating elimination of the step up basis.

Now returning you to your regularly scheduled programming.
__________________
Living an analog life in the Digital Age.
Gumby is online now   Reply With Quote
Old 02-23-2021, 07:52 PM   #84
Thinks s/he gets paid by the post
skyking1's Avatar
 
Join Date: Feb 2021
Location: Puget Sound
Posts: 3,223
We have been having more conversations over the last few days, she is pretty much up to speed on the current strategy. She is also happy that I am doing the legwork on it
skyking1 is offline   Reply With Quote
Old 02-23-2021, 08:11 PM   #85
Recycles dryer sheets
 
Join Date: Jan 2020
Location: Marysville
Posts: 82
Quote:
Originally Posted by JohnRM
Am I misunderstanding how that works? So, If President Biden takes away the stepped-up basis provision,....









I really must take issue with this part of your post. It is Congress that writes and passes tax laws, including any law that would affect the step up basis on inherited assets. The President can only sign or veto what Congress passes. And, in any event, I am unaware that the Biden Administration is advocating elimination of the step up basis.
---------------------------------------------------------------------
I did not mean that as an attack on Biden. However he has proposed eliminating stepped-up basis to help pay for student-loan forgiveness, according to whatever sources Snopes uses;


https://www.snopes.com/fact-check/bi...capital-gains/


Personally I don't think it will happen. I was just replying to the original post that started this thread, which referred to stepped-up basis and I assumed he was talking about this.
JohnRM is offline   Reply With Quote
Old 02-23-2021, 08:31 PM   #86
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
mickeyd's Avatar
 
Join Date: Apr 2004
Location: South Texas~29N/98W Just West of Woman Hollering Creek
Posts: 6,671
I shared our IRS with disinterested DW. Made her ask questions etc. We both signed IPS. We review it annually and sign it again (not for me, but for her). It's a process for us and finally she gets it!
__________________
Part-Owner of Texas

Outside of a dog, a book is man's best friend. Inside of a dog, it's too dark to read. Groucho Marx

In dire need of: faster horses, younger woman, older whiskey, more money.
mickeyd is offline   Reply With Quote
Old 02-23-2021, 08:32 PM   #87
Administrator
Gumby's Avatar
 
Join Date: Apr 2006
Posts: 22,974
Quote:
Originally Posted by JohnRM View Post
...
I did not mean that as an attack on Biden. However he has proposed eliminating stepped-up basis to help pay for student-loan forgiveness, according to whatever sources Snopes uses;


https://www.snopes.com/fact-check/bi...capital-gains/


Personally I don't think it will happen. I was just replying to the original post that started this thread, which referred to stepped-up basis and I assumed he was talking about this.
My issue with the post is not that it is an attack on Biden or even whether eliminating the stepped up basis is a good idea. It is, rather, a concern for accuracy in describing the workings of the government. If we say "the President will do _____" when doing ____ requires changing the law, we are ignoring the form of government specified in Constitution - Congress writes and passes the laws, the President vetoes them or signs them and then sees that they are carried out. Phrasing it as "the President will do ____" validates a dangerously excessive concentration of power in the Executive branch and permits Congress to abdicate its responsibilities, to the detriment of our nation. Inaccurate language leads to inaccurate thinking. This is true regardless of who may be president at the time.

I was unaware that candidate Biden had advocated for elimination of the stepped up basis during the campaign. Thank you for informing me. Although, like you, I think it will never happen.
__________________
Living an analog life in the Digital Age.
Gumby is online now   Reply With Quote
Old 02-23-2021, 10:45 PM   #88
Recycles dryer sheets
 
Join Date: Apr 2017
Location: Portland
Posts: 308
OP, have your wife look at latest issue of AARP's monthly newsletter (if you get it). There's a cautionary real life story of a woman who was happy to let her husband handle all the finances. Then husband starting developing dementia and she had to take over. By then it was too late. She ended up losing the house and broke.
pdxgal is offline   Reply With Quote
Old 02-23-2021, 11:42 PM   #89
Recycles dryer sheets
Morricol61's Avatar
 
Join Date: Jun 2017
Location: Toowoomba, Qld Australia
Posts: 101
Quote:
Originally Posted by corn18 View Post
So I was talking to my wife this afternoon about step up basis and what that means if I die or her mom dies. We must have been talking for 2 or 3 minutes when I look over at her and she is pulling her nostrils apart with her index fingers. Then she says to me "you know, if I pull my nostrils apart, I can smell the cheese I just ate!" She's not very interested in our finances.

The cheese smell probably came from her fingers.
__________________
Doesn't even own a dryer.
Morricol61 is offline   Reply With Quote
Old 02-24-2021, 06:29 AM   #90
Thinks s/he gets paid by the post
 
Join Date: Jul 2004
Posts: 1,558
Excellent thread.

I am single now, but when I was married, we sort of split the finance duties. Interestingly, one of our first conversations when we met was about finances. He was deep in debt but seemed to think if he bought the right stock he would hit it rich, pay off all of his debts and all would be good. Fast forward and we got married, he found out my net worth at that time and started asking how I had done that. We compromised in that he could have some 'play' money to be 'killer stock picker' but that the bulk would be invested in a certain way, automated and re-balanced as necessary. All credit cards would be paid off every month, loans would be minimized and savings maximized. We had a plan for early retirement and looked at it in stages as the different streams of income turned on/off.

I also do and did the taxes by hand - he would then review them. He complained a few times about just using someone to do them, but he realized the last time he reviewed them how I had saved us quite a bit and was fairly good at it even with some complicated situations.

He liked to chase the credit card deals/points/CD interest rates - I cared more about the bigger picture. I calculated what our expenses were every year and by category and would 'report out' that info to him. We were fortunate in that we never had financial issues and there was enough extra to handle some of the obscure things like step-children and ex spouse issues.

I still manage everything, of course, but lately have been looking to simplify my situation even more. I don't have a written IPS, but a general philosophy (Boglehead-ish - used to be Motley Fool Four-ish) that I've maintained over the years. As I can see here, I need to write down a list of where everything is, how to get there and make sure my executor has that info....
__________________
Deserat aka Bridget
“We sleep soundly in our beds because rough men stand ready in the night to visit violence on those who would do us harm.”
deserat is offline   Reply With Quote
Same here
Old 02-24-2021, 06:42 AM   #91
Recycles dryer sheets
 
Join Date: Nov 2010
Location: Crossville
Posts: 425
Same here

Quote:
Originally Posted by foxfirev5 View Post
Yeah, In my case it's not going to work either. While I cherish her, future finances are a wild card upon my demise. Although she does have a enough foresight to veto any annuities.
I have exactly the same issue with my wife. Her reply is always that I just need to make sure I outlive her. And hopefully she feels the same about annuities since she has heard me disparage them enough.
ychuck46 is offline   Reply With Quote
Old 02-24-2021, 08:33 AM   #92
Dryer sheet aficionado
 
Join Date: May 2019
Posts: 35
DW has gotten into the habit of portraying us as being wealthier than we are, especially when she's been drinking.

It worries me.

If we were rich, I wouldn't want people to know. And since we're NOT rich, I don't want people to think we are. That's just asking for trouble.
PatrickW is offline   Reply With Quote
Old 02-24-2021, 12:25 PM   #93
Dryer sheet aficionado
 
Join Date: Oct 2016
Location: Toronto
Posts: 44
My husband and I both have aptitudes (and complementary skill sets) for handling our finances. I'm the capital markets lawyer (and ex-regulator), and he's a whizz at numbers and tech. I passed Level of my CFA many years ago, and persuaded him to do the same. Add to that an engineer father (on my side) whose idea of heaven is building spreadsheets, and we're in pretty good shape.

But for those of you with a significant other who doesn't seem interested in your finances, have you considered that: a) maybe it's how you're approaching the topic; and b) if there is a serious level of disinterest, how problematic this could be in the future?

For example, if my husband comes to tell me about some kind of tech issue relevant to both of us, while I'm sitting on the couch reading law journals (or Bridgerton novels), my eyes are likely to glaze over. But if he said, "I think we should discuss our tech security plans [or the basement waterproofing, or something else I'm not that interested in] because [insert reason]. When is a good time for us to have this discussion?", then I'd be more likely to want to participate in the conversation. And similarly, when I want to talk about the minutiae of our retirement financial plans, I schedule time with him for it.

If your spouse doesn't want to have that conversation, ask them (in a non-judgmental way) why they feel that way. You could then explain why you want to discuss the topic and, hopefully, if you understand each other better, then you can have the discussions you need.
Andromeda is offline   Reply With Quote
Old 02-24-2021, 12:29 PM   #94
Recycles dryer sheets
Lienlord's Avatar
 
Join Date: Mar 2018
Location: Oklahoma City
Posts: 154
Quote:
Originally Posted by Gumby View Post
My issue with the post is not that it is an attack on Biden or even whether eliminating the stepped up basis is a good idea. It is, rather, a concern for accuracy in describing the workings of the government. If we say "the President will do _____" when doing ____ requires changing the law, we are ignoring the form of government specified in Constitution - Congress writes and passes the laws, the President vetoes them or signs them and then sees that they are carried out. Phrasing it as "the President will do ____" validates a dangerously excessive concentration of power in the Executive branch and permits Congress to abdicate its responsibilities, to the detriment of our nation. Inaccurate language leads to inaccurate thinking. This is true regardless of who may be president at the time.

I was unaware that candidate Biden had advocated for elimination of the stepped up basis during the campaign. Thank you for informing me. Although, like you, I think it will never happen.
So having said that, ObamaCare isn't really ObamaCare and the Trump Tax Cuts aren't really the Trump Tax Cuts.
Can we call them PelosiCare and the McConnell Tax Cuts?

But as to the OP issue, my DW also doesn't seem interested in our financial dealings. But my DS is a Finance grad (like me), and his DW is a CPA. So hopefully they can make sense of the mess I've created! LOL!
Lienlord is offline   Reply With Quote
Old 02-24-2021, 12:40 PM   #95
Administrator
Gumby's Avatar
 
Join Date: Apr 2006
Posts: 22,974
Quote:
Originally Posted by Lienlord View Post
So having said that, ObamaCare isn't really ObamaCare and the Trump Tax Cuts aren't really the Trump Tax Cuts.
Can we call them PelosiCare and the McConnell Tax Cuts?
...
I have never called them that and never will. Virtually every law passed has an actual name specified in the law. In this case, they are the Patient Protection and Affordable Care Act (Pub. L. 111-148) and the Tax Cuts and Jobs Act of 2017 (Pub. L. 115-97). If I need to refer to them colloquially, I will call them the ACA or the 2017 tax cuts. Laws don't belong to any particular person, regardless of their position in the government.
__________________
Living an analog life in the Digital Age.
Gumby is online now   Reply With Quote
Old 02-24-2021, 12:46 PM   #96
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Koolau's Avatar
 
Join Date: Jul 2008
Location: Leeward Oahu
Posts: 17,809
We have a current thread on bacon. I like the current discussion about "Talking to my wife about finances." Mixing in the smell of bacon could derail us on this topic. Returning you now to our regularly scheduled discussion.
__________________
Ko'olau's Law -

Anything which can be used can be misused. Anything which can be misused will be.
Koolau is offline   Reply With Quote
Live and learn
Old 02-24-2021, 01:19 PM   #97
Confused about dryer sheets
 
Join Date: Sep 2020
Location: Gold Bar
Posts: 4
Live and learn

My X wife 25 years ago couldn't balance the check book to save her soul, her job was to pay bills. I tried to keep her informed of every investment. Along came the divorce, she said in the divorce papers I blocked her and hid all investments. I was making good money and last two years, every month she said we had to dip into savings to pay monthly bills. She was skimming. Divorce took two years and during this time I went on a cash system. More money going out, alimony, less money coming in. I put every extra dollar in a shoe box under the bed. I didn't count it until the divorce papers were signed. $38,000. Never commingle your money. I have a perfect wife now. Commingle my $12,000,000 in investments. Never.
flyboy541 is offline   Reply With Quote
Old 02-25-2021, 09:35 AM   #98
Recycles dryer sheets
 
Join Date: Feb 2006
Location: Valencia
Posts: 173
I find this thread hilarious. Once I showed my wife a spreadsheet as follows:

amount in checking accout....................xxx

(the "adds")
monthly SS deposit (fixed)...................xxx
monthly pension (fixed).......................xxx

(the subtracts)
monthly mortage (fixed)....................-xxx
utilities (one line guess).....................-xxx
food (one line estimate).....................-xxx

(do we have enough $$ this month?)
net............................................... ...xxx

She said "Too complicated, what's on TV tonight?"

geez, I tried to make it as simple as possible. ugh, I gave up.
albundyz is offline   Reply With Quote
Old 02-25-2021, 10:31 AM   #99
Recycles dryer sheets
 
Join Date: Aug 2020
Location: Houston
Posts: 108
DW is smart, she handles all bills and CC. She sets up auto phone notices whenever there is a new charge on our CC, and moves cash around to take advantages of account balance incentives. But she was terrified about retirement and had no idea how much is enough.
She heard her friends going to talk to Fidelity about retirement and wanted us to do same. I tried to convince her that I had already covered all their talking points and do not want to waste my time. I gradually tried to talk to her on our daily walk, things like kids finances, IRA, Roth conversion, RMD, where to get money for our new house, etc. Not all at once, but one topic at a time. Fortunately, she is beginning to turn around and relax a little bit about our finances.
She checked her IRA account last month and it achieved a second comma. Then she became excited that we are finally millionaires (on paper).
Green Papaya is offline   Reply With Quote
I think most of you guys are being conned
Old 02-26-2021, 12:04 PM   #100
Dryer sheet wannabe
 
Join Date: Nov 2013
Posts: 16
I think most of you guys are being conned

Managing the household finances is not that interesting so if you have someone you trust to do it for you...why not? I am pretty sure that is why my genius engineer husband lets me do it...
digger1959 is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
When did retirement finances become so disconnected with real finances? nun FIRE and Money 4 11-02-2010 01:48 PM
Starting a business talking to young adults about finances? dandan14 Young Dreamers 38 01-20-2007 08:37 PM
Who is my computer talking to? BOBOT Other topics 22 10-17-2006 08:32 AM
Talking about "it" LRS Other topics 59 02-21-2006 09:28 PM
Your kids may not be talking to you, but... Nords Other topics 7 04-06-2005 10:56 AM

» Quick Links

 
All times are GMT -6. The time now is 08:41 AM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2024, vBulletin Solutions, Inc.