Anderson Business Advisors Podcast
Anderson Business Advisors Podcast
How Reinvesting Can Help you Avoid Capital Gains Taxes
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How can reinvesting help you avoid capital gains taxes? Jeff Webb and Eliot Thomas of Anderson Advisors answer that question and others about capital gains. Submit your tax question to taxtuesday@andersonadvisors.

Highlights/Topics:

  • Is it true that creating a revocable living trust will raise my capital gains taxes if I sell my primary residence vs. if I transfer the house into my name, I must live in it for two to five years to qualify for lower capital gains taxes? If you take advantage of Section 121, you have to live in it for two to five years, no matter what. Putting it under the revocable living trust or in your own name can be done.
  • I have sold a real estate transaction in 2022. Can I avoid capital gains taxes if I purchase another real estate transaction in 2022? It depends. If you have already sold it and received the proceeds from the sale, Section 1031 (like-kind exchange) is no longer available or possible.
  • I am a retired person, wanting to give a sum of money to my son. How can I advise him regarding deferring taxes on that inheritance money? You don’t have to tell your son anything because he’s not the one who has to pay taxes on it. The recipient doesn’t have to pay tax. It’s the grantor, donor, and gift-giver that may have to pay taxes on it.

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Resources:

Living Trusts

Capital Gains and Losses

Entity Formation

Schedule C

Section 121 Exclusion

1031 Exchange

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Full Episode Transcript: 

Jeff: Hi, I’m Jeff Webb. I am the Vice-President of Professional Services here at Anderson Advisors. With me today is Eliot Thomas, the Tax Advisor Manager. He’s in charge of all your tax advisors at Anderson. Toby Mathis is unable to be with us today so we’re going to try to pull through without him. We’re going to go ahead and do the Toby check. So if you want to tell us where you are, so we make sure everybody can hear us. That would be great. 

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