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CPslograd

Taxes are dumb

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I'm finishing up my 2017 income taxes.

Sold the house in Camarillo, which we had purchased in 2005.  Had rented it out the last 6 years.

It wasn't a good time for me to do a 1031, I was in transition at work and had some health stuff with my folks to deal with.  Plus, I wasn't stressed about it, because the purchase price + improvements + sales commission was relatively close to the sell price.  So we took our time, and bought a rental on our timeline instead of the exchange requirements.

But I didn't factor in six years of depreciation deductions to my tax burden with the sale.  So now it shows 70 grand of income from the sale to report that I wasn't planning on.

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19 minutes ago, CPslograd said:

I'm finishing up my 2017 income taxes.

Sold the house in Camarillo, which we had purchased in 2005.  Had rented it out the last 6 years.

It wasn't a good time for me to do a 1031, I was in transition at work and had some health stuff with my folks to deal with.  Plus, I wasn't stressed about it, because the purchase price + improvements + sales commission was relatively close to the sell price.  So we took our time, and bought a rental on our timeline instead of the exchange requirements.

But I didn't factor in six years of depreciation deductions to my tax burden with the sale.  So now it shows 70 grand of income from the sale to report that I wasn't planning on.

Ahhh.  If it makes you feel any better, that 70k was only a timing difference.  You got 70k of depr deduction each of the years you rented it, saving you taxes in those years.  Now it's time to pay it back.  If you were in the same tax bracket all those years, present value of cash flow favored you.

But I understand the surprise.

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59 minutes ago, pokebball said:

Ahhh.  If it makes you feel any better, that 70k was only a timing difference.  You got 70k of depr deduction each of the years you rented it, saving you taxes in those years.  Now it's time to pay it back.  If you were in the same tax bracket all those years, present value of cash flow favored you.

But I understand the surprise.

Thanks for the effort, but no.  That doesnt make me feel any better.

.

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