Comment on This boomer couple would be hit with $700,000 tax bill if they sold their mansion

throbbing_banjo@lemmy.world ⁨1⁩ ⁨day⁩ ago

• Delphia@lemmy.world ⁨23⁩ ⁨hours⁩ ago

  The unfair part of this is that the $500k threshold for the tax hasnt been updated since 1997.

  In 1997 the average price for a house in California was about 180k now its $800k. If the tax was the same ratio it now wouldnt apply until the house was worth about 2.2mil (napkin math, I’m not getting out the calculator) Now I’m not saying they arent crying about a problem many of us would kill to have but thats a difference of about $340,000 in taxes.

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  • 13igTyme@lemmy.world ⁨1⁩ ⁨hour⁩ ago

    Keep in mind, it’s profit. If you bought the house for $500k and selling for $800k, that’s only $300k in profit. Plus you can include the cost on renovations and there are lower percentages when you own and live in the house for over 2 years.

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  • Soup@lemmy.world ⁨10⁩ ⁨hours⁩ ago

    And how much have wages gone up? $500k is still very expensive, sounds like maybe it should be a little more but it sounds more like a consequence of letting housing prices run away for a few decades.

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    • Delphia@lemmy.world ⁨9⁩ ⁨hours⁩ ago

      Either you shouldnt be paying any capital gains on a primary residence full stop or it should be on a sliding rate over time. (20% for first year -1% per year after)

      Buying a house (even a mcmansion) and living in it for 30 years isnt a hustle or an investment strategy… its just living.

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      • deathbird@mander.xyz ⁨5⁩ ⁨hours⁩ ago

        That’s… actually an interesting way to slow down flippers.

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  • surewhynotlem@lemmy.world ⁨20⁩ ⁨hours⁩ ago

    They knew the limit when they bought the house. And it’s gone up more than they could’ve dreamed. That’s plenty fair.

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    • jj4211@lemmy.world ⁨19⁩ ⁨hours⁩ ago

      Problem is their house went up by a huge percentage, but so to has every housing arrangement they will need.

      Maybe not a whole lot of sympathy for someone having to sort out living arrangements with ‘only’ $2.8 million or so to work with, but this can scale down to pretty ‘normal’ house prices like $500k.

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  • bluefootedbooby@sopuli.xyz ⁨22⁩ ⁨hours⁩ ago

    It’s still only “up to 20%” 🙄

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