Capital Gains

[You]

tis the season!

item bought and sold within 1 years time thus qualifying as a short term capital gain = HIGH tax rate

could the potential profits of the sale be turned into a long term capital gain (= much lower tax rate) via seller provided financing, with the 'final payment' being a few years out?

a significant down payment would be made, followed by months of set payments until the balance was -0-

 

[BrokenBackJack]

So your basically calling it a contract for deed?

 

[johnr]

it'll never work

 

[You]

So your basically calling it a contract for deed?

Yea, the only reason I didn't is because when I hear cfd I think land and I want to speak in more generic terms.

 

[Ericb]

According to the contract who technically owns the property at this time?

 

[shorthairsrus]

1st -- what type of asset are we talking about?

 

[You]

According to the contract who technically owns the property at this time?

Me. Free and clear. But the contract would give them full use/control/access day one of signage.

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1st -- what type of asset are we talking about?

I would like to know as it pertains to personal property, equipment, land, and vehicles.

 

[SDMF]

Me. Free and clear. But the contract would give them full use/control/access day one of signage.

I would like to know as it pertains to personal property, equipment, land, and vehicles.

You're divesting yourself of You's "Bumps and Boobs" bumpercar and brothel operation?

 

[You]

You're divesting yourself of You's "Bumps and Boobs" bumpercar and brothel operation?

:;:smokin

Theres just no getn nuffin past you guys

 

[shorthairsrus]

What it does not work on:

sales by a dealer
sales of inventory
depreciable property sold to a relative
gain attribited to deprec recaputure.
publicly traded property

 

[deleted_account]

Y'all are speaking in pig Latin to me, so I'll just let the adults talk

 

[espringers]

Just do what feels right and is best for your bottom line. Deal with the consequences, if any, later. Screw the man.

 

[You]

Just do what feels right and is best for your bottom line. Deal with the consequences, if any, later. Screw the man.

but then if things went south, I'd likely need to seek counsel....

hey wait a minute! U gamin' me bro?!

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What it does not work on:

sales by a dealer
sales of inventory
depreciable property sold to a relative
gain attribited to deprec recaputure.
publicly traded property

This helps some as I'm not a dealer, a retailer with inventory, never sell shit to family (statement), it isn't publicaly traded property, and the gain won't be due to depreciation recapture.

 

[Ericb]

Well unless stated in the contract you You would own the property until final payment is recieved. Thus that would be MY final purchase date. If payments wernt made would you repo the collateral or sue for non payment? What official records would there be fir the original purchase?

Not nowing the entire deal. is there a title or proof of ownership that will be sighned transfered?

I applaud you for doing your due diligence! Unless your just being vague for the hell of it I imagine this will play out how ever You decide to present this to the IRS. If thats the case I would do whats best for you You!

 

[espringers]

^^^^this

 

[You]

Well unless stated in the contract you You would own the property until final payment is recieved. Thus that would be MY final purchase date. If payments wernt made would you repo the collateral or sue for non payment? What official records would there be fir the original purchase?

Not nowing the entire deal. is there a title or proof of ownership that will be sighned transfered?

I applaud you for doing your due diligence! Unless your just being vague for the hell of it I imagine this will play out how ever You decide to present this to the IRS. If thats the case I would do whats best for you You!

That's kinda what I was thinking. Yea, no title of ownership is transferring until the final payment. I'd repo the shit outa the collateral/take possession if the buyer quit making payments. A contract will be in place outlining a down payment and then a complete amortization schedule will be attached/included with the contract outlining monthly payment intervals and amounts.

 

[KDM]

This may not apply, but keep in mind that if you still own the product until the final payment and let the guy making payments use it, you will, in all likelihood, still be liable for it's use. Who carries insurance, legal responsibility, etc. etc. if something happens? If the new guy wrecks the thing, sells it, rents it out, etc, etc, it could get sticky.

 

[remm]

That's kinda what I was thinking. Yea, no title of ownership is transferring until the final payment. I'd repo the shit outa the collateral/take possession if the buyer quit making payments. A contract will be in place outlining a down payment and then a complete amortization schedule will be attached/included with the contract outlining monthly payment intervals and amounts.

Hence, contract for deed. no matter what You want to call it. If both parties dont have a cut and dried written deal as to terms/time/payments etc -see espringers- i'd be hestitant to enter any agreement whether buyer or seller

 

[Captain Ahab]

What is your current top tax bracket? That will determine what rate you will pay on a short term capital gain. If you make "yuge" money and you are in the top brackets, it may be worth trying to get your sale past a year of ownership to make LT capital gains at the max of 15%. If you are in the lower brackets, you may just want to cut and run.

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Or better yet, talk to an actual tax professional and explain your case.

 

[eyexer]

If your related to Al Sharpton none of it matters, get on with it