I'm in the process of setting up an estate plan for my widowed mother (50 years old). She has some cash saved up (not much, under $100k), but she does have some real-estate:Rental property $650kPersonal Residence $350Both of which have appreciated quite a bit (>50%)She's having some medical problems and can no-longer manage the rental property (which is her sole source of income) on her own.So I'm looking for ways to unload the property and re-invest the proceeds so that she will have a steady stream of income for the remainder of her years. I also want to minimize or income (as well as capital gains) taxes, and in the process avoid any estate taxes that will surely come up later on.In my research, I came across NAFEP (National Association of Financial & Estate Planners) http://www.nafep.com/index.html. Any body familiar with the programs they offer? Are they legitimate? Their programs sound like that's exaclty what I need.Any thoughts?Thanks,George
Estate planning is not in my area of expertise. I do know that frequent board contributor Chris Riser has a publication available at www.soapbox.com on the basics of estate planning. You may want to check that out.TMF ExROPhil Marti
Phil,Thanks for the reply.While any estate planning advice would be welcomed, I was specifically wondering if a private annuity is an acceptable form of payment (as far as the IRS was concerned) with respect to Capital Gains?The program being pushed by the NAFEP site would have you believe that you could postpone paying capital gains on the sale of a property by selling the property for an annuity. Then deferring distributions from the annuity until say your 69th birthday.This sort of sounds like an installment sale, with a twist: payments don't start until some time in the future.Please see the original note for a pointer to their website and the details on this program.Does this sound valid?Thanks,George
While any estate planning advice would be welcomed, I was specifically wondering if a private annuity is an acceptable form of payment (as far as the IRS was concerned) with respect to Capital Gains?I took a quick look at the site and quickly realized I was in over my head. When I got to the part about a trust "buying" something and "paying" for it with something else, I gave up. When I see perfectly understandable words in quotation marks, I start to think someone's up to something. It doesn't mean they are, it just means that I don't trust them. That's my prejudice, and it in no way indicates it's valid.If Chris Riser should happen along and comment, pay attention to what he says. He knows this stuff. You might also check out www.quatloos.com, which has a lot of information about tax avoidance schemes that don't pass muster.Sorry I couldn't be of more help.TMF ExROPhil Marti
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