Q: Retired. This question is regarding the proposed June 25/24 tax changes.
I have unrealized capital gains of $110k and my wife has $30k. We also have a house worth roughly $5-600k.
4 questions:
1. My understanding is, upon the last death of my wife or I, the proceeds of the house will pass on to our beneficiaries (our kids)....tax free. Correct?
2. My wife's $30k unrealized CG isn't large enough to warrant being proactive. Agree?
3. My $110k unrealized CG is large enough to at least look into it further. My largest unrealized CG is in WSP (even though I have trimmed it 18 times) = $32k.
I see 2 options = #1 is do nothing because the house doesn't factor in and the $110k is well below the $250k threshold. #2 = sell some or all of WSP, then buy it all back the next day.
Any thoughts, knowing you can't provide personal advice?
4. Just to confirm, because WSP would be sold for a capital gain, there is no need to wait 30 days to rebuy....agree?
Thanks...Steve
I have unrealized capital gains of $110k and my wife has $30k. We also have a house worth roughly $5-600k.
4 questions:
1. My understanding is, upon the last death of my wife or I, the proceeds of the house will pass on to our beneficiaries (our kids)....tax free. Correct?
2. My wife's $30k unrealized CG isn't large enough to warrant being proactive. Agree?
3. My $110k unrealized CG is large enough to at least look into it further. My largest unrealized CG is in WSP (even though I have trimmed it 18 times) = $32k.
I see 2 options = #1 is do nothing because the house doesn't factor in and the $110k is well below the $250k threshold. #2 = sell some or all of WSP, then buy it all back the next day.
Any thoughts, knowing you can't provide personal advice?
4. Just to confirm, because WSP would be sold for a capital gain, there is no need to wait 30 days to rebuy....agree?
Thanks...Steve
5i Research Answer:
At death, assets are deemed to have been sold. A principal residence remains tax-free. The first $250K (individuals) is at the old 50% inclusion rate, so a total $30K gain does not see any tax rate change and we do not think any moves should be based on tax only. Same with $110K in unrealized gains. Much here now will depend on 'future' gains. But one can spread gains across dividend years to maintain the prior lower tax rate (i.e. if one has $500,000 gains one can split this over two calendar years and still get the 50% inclusion rate). If we were in this boat, we would see doing nothing as the best option.