OT Rush Limbaugh’s Beach Home for sale

{TMF, you’ll likely be asked to delete this post, but I believe it meets all of METAR’s requirements. Please check with WendyBG first.}

From $3.9M to $150M not bad! I wonder how much inflation had to do with it?

Rush Limbaugh’s Palm Beach Home Aims to Sell for $150 Million to $175 Million

The waterfront property with a roughly 24,000-square-foot main house was ‘largely decorated’ by the late conservative commentator

Mr. Limbaugh purchased the property for $3.9 million in 1998 through a limited liability company, records show.

https://www.wsj.com/articles/rush-limbaughs-palm-beach-home-…

From $3.9M to $150M not bad!

Irregardless of the person involved that does have a macro economic point in that is shows the impact of the stepped up cost basis which will allow his estate to sell it and not pay any capital gains taxes.

7 Likes

Mr. Limbaugh purchased the property for $3.9 million in 1998 through a limited liability company, records show.

the stepped up cost basis which will allow his estate to sell it and not pay any capital gains taxes.
If he bought with an LLC, it’s the corp that owns it, not the estate. Not sure that the cost basis will have anything to do with it since the corp hasn’t died.

2 Likes

Rush Limbaugh’s Palm Beach Home Aims to Sell for $150 Million to $175 Million

I aimed to retire with $30 million.

Reality was, unfortunately, quite different.

However, I’m quite sure Rush’s heirs will be crying all the way to the bank.

AW

1 Like

Let’s hope that this house isn’t haunted. :slight_smile:

Let’s hope that this house isn’t haunted. :slight_smile:

Son: “Dad, can we go to a haunted house this Halloween?”
Dad: “What’s wrong with the one we live in?”
Son: “…what?”
Dad: “Good night, son”

If I had $150 Million I’d do something more useful than buy an expensive house. Maybe a private jet to go sightseeing.

Even with private jets becoming more accessible, new private planes cost anywhere from $2 million for a small seven-passenger Cirrus Vision to $500 million for a highly customized Airbus A380. And the purchase price is far from the only cost involved — you’ll also have to factor in maintenance, fuel and staff salary. Before you start shopping, get the full scope on what a private jet costs and how to pay for one.

https://www.bankrate.com/loans/personal-loans/how-much-does-…

When I had $2 million I bought a sailboat, a used Sabre 38.

The Captain

FYI:

https://www.zillow.com/homes/1495-N-Ocean-Blvd-Palm-Beach,-F…

Last tax assessment had it at $30mil. Zestimate has it at 100 mil.

Of course, we don’t know what it looked like in the 90s but it very was an empty lot or and older home. From 96 to 98, there was also a 41% reduction in asking price.

From 99 to '01, the value tripled (suggesting the lot was significantly improved) and then more than double from 01 to 03.

Safe to say that this property didn’t simply inflate in value from $3mil to whatever it sells for. The owner invested in the property and thus increased the cost basis.

1 Like

If he bought with an LLC, it’s the corp that owns it, not the estate. Not sure that the cost basis will have anything to do with it since the corp hasn’t died.

An LLC is not a corp. An LLC isn’t a recognized entity in the tax code. It will always be taxed as something else - either directly on an individual’s return, as a partnership, or as a corporation - either S or C.

So we really don’t know how this gain will (or will not) be taxed without knowing the details of Mr. Limbaugh’s tax situation and the elections he may or may not have made.

One thing that is a pretty good guess is that this LLC is not being taxed as a C corporation. C corps don’t have a lower tax rate on long term capital gains. They are taxed at ordinary rates along with all other income. And since this was a residence and not some kind of business property, it would be approaching malpractice for a tax advisor or a lawyer to recommend electing to tax this LLC as a C corp. You are pretty much guaranteeing to pay the highest possible income tax rate on any eventual sale of the property. And since, as you point out, the owner would be treated like a C corp, there is no step up in basis on the C corp owner’s death.

All of the other possibilities will generally result in the ultimate tax being paid as if Mr. Limbaugh owned the property directly. And that would probably include a step up in value at his death.

What is more certain is the estate tax. There is no cost basis issue with estate taxes. It’s all based on the value of the assets as of the date of death. At $150 million (give or take a bit since he died over a year ago), any estate tax exemption is long used up and there will be some estate tax to be paid. And that’s just on this specific asset. All other assets would be taxed as well, and those may be significant.

But even that might be a bit of an overstatement. While there will certainly be estate taxes, they may not be due now. Mr. Limbaugh was married at the time of his death. So he could have left his entire estate to his wife and there would be no taxes due now (really a few months ago at this point). The estate taxes would be deferred until her passing.

It can all get a bit complicated, but there is a reasonable possibility that the real estate did get a step up in basis at Mr. Limbaugh’s death.

–Peter

5 Likes

If I had $150 Million I’d do something more useful than buy an expensive house.

Actually, Rush Limbaugh bought/had built several expensive guest houses for when he wanted friends or associates to stay over. Probably a tax thing I think.

At the rarefied financial levels Rush Limbaugh was at, buying/building a few houses conveniently nearby was just an afterthought.

1 Like