Thanks for all the explanations. I was familiar with the depreciation recapture and all that, but from these scenarios, I don’t think it’ll be that bad since a lot of the tax situations could be controlled. If you are ultra wealthy, you can pass it on tax free, for less so, can’t you also just move into said property for 2 years and sell for the 500k tax free benefit as well?
I know a lot of other friends’ parents doing that over the past few years.
With tax code constantly changing, I think it’s just wise to keep deferring till you are in a situation where you can take the tax hit, and not be hurt too bad.
Sorta like now, if you are off work or between jobs, start converting your regular IRA to the Roth if it won’t cause much tax.
Get a mortgage just before you retire so you have a large tax deduction for any large IRA withdrawals required…
I suppose easier said than done for some folks since they never stop working. 🙂
