The Motley Fool Discussion Boards
Financial Planning / Tax Strategies
|Subject: Re: S.O.S. MOTLEY FOOL STAFF||Date: 12/28/2004 10:41 AM|
|Author: galagan||Number: 75008 of 120460|
large acreage caries a lesser value per acre as opposed to selling by the acre.
Good advice from everybody, but let me throw in one more thing.
I've seen farmers with large amounts of land who sought to subdivide and sell lots. They have received advice from CPAs to the effect that if they do so and sell a sufficient number of lots, they technically become treated as real estate developers in the business of selling land, which turns their farmland into inventory and turns what would have been capital gains into ordinary income. This is an extremely bad result for most people.
The advice in one particular case was that the number of transactions that would get someone in trouble could be as few as four or five.
I didn't independently verify, so take it for what it's worth.
|Copyright 1996-2014 trademark and the "Fool" logo is a trademark of The Motley Fool, Inc. Contact Us|