Real Estate Case Studies
Gifts of Real Estate and the “Flip” Unitrust
Before you sell a real estate holding, answer this: Which would you rather do?
- A) Defer capital gain taxes or
- A) Miss out on a tax deduction or
- A) Receive ordinary income or
- A) Continue managing property or
- A) Miss the joy of giving or
- B) Avoid capital gain taxes
- B) Benefit from an income tax deduction
- B) Receive capital gain income
- B) Eliminate management headaches
- B) Leave a memorable and lasting legacy
If you answered B) to most or all of the questions above, a charitable exit strategy using the “Flip” unitrust may be your best choice for divesting real estate.
Contact our financial professionals today at 888-311-4717 or firstname.lastname@example.org. We’ll answer your questions and help you determine what strategy is best for your unique circumstances.
Mr. Hobbs owns an apartment building valued at $950,000, with an adjusted basis of 100,000. Selling the property himself would result in selling expenses of about $76,000 (8%) and a capital gain tax of about $178,000 (in a 23% combined state and federal capital gain tax bracket), leaving him about $626,000 to reinvest; a shrinkage of about 34%. If he is able to earn a 5% return, he will have about $31,300 of annual income.
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The information on this website is not intended as legal or tax advice. For legal or tax advice, please consult an attorney. Figures cited in examples are for hypothetical purposes only and are subject to change. References to estate and income taxes apply to federal taxes only. State income/estate taxes or state law may impact your results.
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