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Subject:  Re: Taxable gain on house sale? Date:  6/25/2019  2:53 AM
Author:  aj485 Number:  5795 of 5833

Just something else to throw into the mix - for anyone with RMDs, it can be tougher to control income and tax ramifications.

I would agree with that. But even with that, as a single filer in 3 years, to have all $250k of capital gains from the house taxed at a 20% rate, as was suggested, there would need to be $450k in other taxable income. Say there is $30k in taxable SS income ($35.3k in total SS income, since a max of 85% is taxable), and $70k in taxable pension income.

With a standard deduction of $25k, that would mean that there would have to be $375k in additional taxable income for the entire $250k in capital gains to be taxed at a 20% capital gains rate. For someone who is 90 years old, there is an 11.4 year life expectancy. To have a $375k RMD at that age, the total in Traditional accounts would have to be $4.275MM Even at 95, with a life expectancy of only 8.6 years, the Traditional accounts would still have to be $3.225MM for the entire $250k of taxable capital gains to be entirely taxed at 20%

I just wanted to point out that hypothesizing that the entire taxable capital gain from the sale of a house will be taxed at 20% seems excessive for at least 99% of taxpayers. Granted, TMF probably has more 1%'ers than many other websites. But even if it's 10% - that still means that the estimate is excessive for 90%

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