WHAT’S THE BENEFIT IF TAXES WILL EVENTUALLY HAVE TO BE PAID?
With proper estate planning, you may never pay capital gains tax! There are many tax-planning vehicles that allow taxpayers to relinquish their low basis assets (such as real estate) without paying taxes. Gifts to loved ones, charitable contributions, and certain irrevocable trusts are just a few options available to savvy investors. Even without a complex estate plan, if you exchange instead of sell it will benefit your heirs. Any property included in a descendant’s gross estate will be transferred to your heirs with a basis “stepped-up” to fair market value. This means that all capital gains in the property will be wiped away provided the estate’s value does not exceed the statutory exclusion limitations.
