Have You Owned Your Home for a Long Time? Here Are Some Ideas on Limiting Your Capital Gains Liability

Real_Estate_Today_byline   If you bought your primary residence back in the 1960s or 1970s, there’s a good chance that you’ll be pushing the limits of the capital gains tax exemption when it comes time to sell.

Fortunately, the recently enacted tax reform bill retains the $250,000 exemption from capital gains tax for a single person, and the $500,000 exemption for a married couple. If you bought your house for, say, $30,000, in the 1960s, it’s quite possible that it’s worth 10 or 20 times that amount now, resulting in the possibility of capital gains taxation.

I am not a CPA or tax advisor, but I can share some of what I’ve learned about strategies to avoid capital gains taxation on the sale of your home.

If you’re a couple thinking that you might want to sell before you both die, consider selling before one of you dies, or your $500,000 exemption will be cut in half. Remember that you have to have lived in your home for at least two of the five years prior to sale date, in order to have that exemption, so if you recently moved into, for example, an assisted living facility, you’ll need to sell it within three years of your move or you’ll lose the exemption.

Do not add your heirs to the title of your home as a “joint tenant” with rights of survivorship.  Why not?  Because, although it may simplify the passage of ownership to them upon your death, it simultaneously adds to their tax liability.  This occurs because they inherit your original purchase price as their cost basis, whereas if they inherit the property through your will, the basis for them is stepped up to the fair market value of the home at the time of the inheritance. Again, this requires that you not move out of the house more than 3 years prior to passing.

If one of a married couple moves out, the $500,000 exemption is preserved by the other spouse as long as the absent spouse is still alive, providing the couple sells the house within 3 years of the last spouse moving out.

Again, I am not a tax advisor, and am only recounting what I have been told by tax and estate-planning professionals. Consult your own tax  professional before acting on anything I have said in this article. If you don’t have a tax advisor, I can help you find one.

If you’d like to know what your home is currently worth, or what it might sell for, call Golden Real Estate at 303-302-3636 for a free market analysis.  Our agents are also available to meet with you in your home.

If you’re considering moving into a senior community — whether independent living or assisted living — we know experts on such facilities, which are usually rentals.

Downsizing could take the form of moving into a low-maintenance or zero-maintenance condo, townhome or patio home, in which case we, as Realtors, can serve you ourselves. If you are worried about selling your current home and then not being able to find a replacement because of the low number of active listings, we have strategies for avoiding that situation. Call us for a free consultation.

Considering an Electric Vehicle? Here’s Some Practical Advice

Obsolete_thumbnailAs an “early adopter” of electric cars, I am often asked about how they work and whether they make sense for particular buyers. I’m happy to speak with you (or your group) on the topic, but let me share some general advice.  (At right is the opening slide of my PowerPoint presentation, which you can view at www.GasCarsAreObsolete.info.)

1) Plug-in hybrids are a good first step. My favorite is the Chevy Volt. My 2012 Volt has 78,000 miles on it, performs like new, and I get 2,000 to 3,000 miles on each 8-gallon fill-up.

2) Used electric cars are a real bargain. You can get a used Volt for $10,000 or less. Unlike a used gas-powered car, there’s almost nothing that will fail in a used electric car — no transmission, timing belt, exhaust system, etc.

3) If you’re waiting for a Tesla Model 3, consider getting your deposit back and buying a used Tesla Model S.  There are plenty on the market for as little at $45,000.  A comparable Model 3 could cost at least that much and there’s no telling how long your wait might be for the Model 3.

4) If you want to buy a new Model S or Model X, use my referral code to get lifetime free supercharging: http://ts.la/james6985.

 

Come to Golden Real Estate for a Tour of Our Net Zero Energy Office

DSC_0016As mentioned in last week’s column, we’re hosting a tour of our 17695 S. Golden Road office on Thursday, Feb. 22nd. You’re invited to drop by anytime between 3:30 and 5 p.m. You may find ideas for how to retrofit your own home or office to make it more energy efficient!  We want to be sure to have enough hors d’oeuvres, so please email Jim@GoldenReal Estate.com to let us know you’re coming.

MuralsThe following evening (Friday), there’s a similar opportunity to tour my listing at 1960 S. Gilpin Street, near Denver University. The seller of this net zero energy “passive house” is having a party for friends prior to her move to Boulder, and she said that anyone interested in its sustainable features is also welcome. I’ll be there myself to speak with anyone interested in making an offer.

 

Net Zero Energy Home Near Downtown Golden Just Listed by Norm Kowitz

Passivhaus012_previewBuilt from the ground up in 2014 to meet the stringent energy standards of Germany’s PassivHaus Institute, this amazing home at 407 Garden St. is one of the most – if not the most – green homes in Colorado.  An ultra-efficient building envelope allows this ingeniously designed home to consume as little as 10% of the energy used by a traditional home of the same size. It’s entirely electric, with electricity consumption offset by a 3.9kW photovoltaic system, making the home a net-zero residence and delivering a HERS rating below 10. Currently 1 bedroom and 1 bath, the home was designed with a 440-sq-ft second floor in mind, which would add 2 bedrooms and another bath (plans included). To top it off, the home sits on a private lot with incredible mountain views and is located just a few steps from the Tucker Gulch walking path, half a mile from the heart of historic downtown Golden. Norm Kowitz will be holding this home open this Saturday, Feb. 24th, noon to 2 p.m. Meanwhile, you can view a narrated video tour of this home and its sustainable features at www.NorthGoldenHome.com, or call Norm at 303-229-3891.

 

Rare 3+ Acre Golden Parcel Just Listed by Kristi Brunel

Zillow_mapBuild your dream home on 3+ acres in Golden!  Imagine a mountain view to your west and easy access to all Golden has to offer. This parcel at 15806 W. 12th Ave. is nestled near the base of South Table Mountain and is close to mountain biking/hiking trails, I-70, light rail, Colorado Mills and the National Renewable Energy Laboratory (NREL). Zoned R2, this parcel also has great potential for a small residential development. The aerial view at left (from Zillow) shows the parcel’s location on the west side of Research Road, halfway between South Golden Road and the employee entrance to NREL. Below is a view of the lot from Research Road, looking to the west with the mountains in the distance. Visit http://www.GoldenAreaLand.info or call Kristi at 303-525-2520 for more information — or simply drive by to take a look.

DSC_0837

Don’t Miss the 12th Annual Colorado Environmental Film Festival Next Weekend

ceff 2018 program coverOnce again, Golden Real Estate is pleased to co-sponsor the Colorado Environmental Film Festival (CEFF), held at the American Mountaineering Center in downtown Golden.

Held next Thursday through Saturday, this year’s festival features a record 56 films from 10 countries as well as from local filmmakers  You can see the schedule and buy tickets online at www.CEFF.net.

Opening night (Thursday, Feb. 22nd) is a free “community night,” including a reception with drinks and light appetizers, opportunities to interact with local businesses (including Golden Real Estate), a silent auction benefiting CEFF programs, and the screening of Chasing Coral. This documentary, which was recently short-listed for an Academy Award, looks at coral reefs around the world, which are vanishing at an alarming rate. Zach Rago, one of the stars of the film, will attend the screening and participate in a Q&A session following the screening. CEFF will also announce its five selected 2018 award winning films at the close of the evening. Reserve your free ticket for Thursday on the festival’s website.

Themes for this year’s films range from rivers, transportation, and climate change to endangered species, food/farming, and more. Countries submitting films include the United States, Australia, India, China, Mexico, Canada, Costa Rica, Slovakia, Indonesia and Brazil.

Two other features of the festival are a photographic exhibit and an eco-expo. The Environmental Photography Exhibition and Reception have become a much-anticipated part of this annual film festival. The free reception for the photography exhibition happens on Friday night with a keynote address entitled “Pretty Pictures Are Just Not Enough” by Kerry Koepping, Director of Arctic Arts Project. Complimentary drinks and appetizers are served. The exhibition remains on display at the American Mountaineering Center through April 27, 2018

The Eco-Expo Call2Action is open to the public without a ticket and answers the question, “What can I personally do to affect this issue?” The Eco-Expo features solutions-based organizations  fo-cused on environmental issues. Filmgoers will be exiting the two theaters galvanized to take action on a multitude of environmental concerns presented in the films. The expo hours are noon to 7:30 on Friday and 10 am to 7 pm on Saturday.

Descriptions of all films and their length is at www.CEFF.net/films-2018/. That web page is great, providing filters allowing you to quickly find which films match your environmental area of interest. You can specify short films vs. feature films, Colorado vs. foreign, documentary vs. drama (or comedy, adventure, animation, etc.) as well as 21 different issues (e.g., climate change, GMOs, rivers, etc.).

Half of the 56 films this year are “shorts,” ranging from 4 minutes to 28 minutes. There are 16 feature length films ranging from 40 to 93 minutes in length. There are 12 films in the “Youth” category. One of them is a 17-minute film called “Melting Away” by Colorado high school student Liam Watson, whose passion for skiing drove him to explore how climate change may impact his favorite sport.

 

Take a Behind the Scenes Tour of Golden Real Estate on Feb. 22nd

Aerial_view_of_office     You may recall my Jan. 4 column in which I described the latest steps taken at Golden Real Estate to move our building to (and beyond) “net zero.”  It involved replacing our gas forced air furnace with a “mini-split” system using only electricity for heating and cooling. Our gas meter has been removed, and now we power and heat our office, as well as charge our electric cars and those of visitors, using only our 20 kilowatts of solar photovoltaic capacity. Without natural gas service, we now consume no fossil fuels, and our Xcel bill is only $11.79 per month (the base charge for being connected to the electrical grid).

Next Thursday, immediately prior to the opening of the Colorado Environmental Film Festival, we’re hosting a behind-the-scenes tour at Golden Real Estate to explain all the many elements contributing to the sustainability of our business. In addition to the mini-split system, you will see how we use sun tunnels to daylight our office and how we super-insulated our building. Come anytime on Feb. 22nd, 3:30 to 5:00.  Refreshments will be served.

Our office is at 17695 S. Golden Road. When you come, bring your white Styrofoam for recycling!