On Paying taxes

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Jonathan wrote in the previous thread:
Paying taxes is the sign of success. Better to pay taxes than eat losses.

I often see people complain that they are reluctant to sell some “investment” due to the taxes due.

Minimizing the taxes due makes “some” sense.
But not selling just cause “taxes”, is an investing “error”.

IMO, LOLOLOLOL
:vulcan_salute:
ralph

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I’m frequently asked if we want to sell any of our rental properties.

I’ve calculated the return necessary on an alternative investment to achieve the same return on our units including both free cash flow and appreciation. Assuming a 6% return, I need to sell the units for about twice market value to achieve the same return and a 28% premium if 10% return is assumed.

Cost of sale, capital gains, depreciation recapture, eats up a lot of the principle available to put into alternative investments. If we hold until one of us dies, our cost drops to cost of sale only leaving a lot more principle available to put into alternative investments.

It used to be when asked if I wanted to sell, I’d ask them to demonstrate how my return gets better. From what I can tell only the real estate agent comes out ahead. Now I politely say no.

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I constantly get postcards asking if I want to sell any of my houses. My husband gets great joy at waving them in front of me as he knows I find them annoying.

I have a flat rate realtor on speed dial should I want to do that. But I don’t. Go away.

Greedy vultures looking for desperate people.

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I’m frequently asked if we want to sell any of our rental properties.

I get calls quarterly asking if I want to sell a couple pieces of property. My first thought is, there is nothing out there that I can buy that would replace the return. Even if I were to do a 1031 exchange to avoid taxes and depreciation recapture, still wouldn’t work.

JLC

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