brian johnson

Comments:

• Your brother has cycled through several property managers? And he is flying in on a monthly basis to check on the properties and to quiz the manager on his management decisions? Clearly he is struggling with the concept of delegation of duties. Maybe he needs to reflect on why he can't seem to find anyone (inside or outside of his family) that is suitable to manage these properties. The answer is looking at him in the mirror. I don't blame his kids for staying away from this situation.They probably don't want their dad to treat them in the same manner as he treats the property manager. His decision to sell the properties (and the refusal to consider a 1031) seems to be an emotional reaction to his frustration that he can't be in 100% control any longer. By the way - the conversation misrepresents the timeframes that are applicable to a 1031 transaction. After the sale of his real estate, he has 45 days to identify the potential replacement properties, and up to 180 days to close on the purchase.

  Post: The Motivated Seller by Steve Abramowitz

  Link to comment from August 8, 2024

• You've acknowledged 3 uncertainties that might affect your plan. But have you considered the uncertainty that your plan creates for your kids and grandkids (once you've disclosed the plan to them)? You are not making a firm commitment to pay for 2 years of college costs, and so you are making it hard for your children to decide whether to count on getting funds from you. As a result, they'll probably have to continue to save regularly for the next 10 years (for fear that grandpa will back out on the pledge). Or worse - your kids decide to count on you to pay for 1/2 of college for each grandchild, and then they find out at the last minute that your pledge will not be honored. Also, your plan relies in part upon you living until the last grandchild is in his senior year of college. You'll be into your 80s by the time some of these kids are entering college. What happens if you pass away while some grandchildren are not yet in college? Will the parties who inherit your IRA be bound to honor the payments to your grandchildren? Are you going to adjust your estate plan to ensure that if you die before those 2 year olds get out of college that their college costs will be paid by your estate (just as you paid for their older cousins during your lifetime via the after-tax funds from the RMDs)? Your heart is in the right place here, but it would be much simpler just to start taking some IRA distributions now and then you can use that money to add to the existing 529 accounts. You're not avoiding taxes via this plan; you are deferring them. Is that deferral worth the complexity that may result?

  Post: Grandpa’s Scholarship

  Link to comment from March 24, 2023

• You may want to get more aggressive with the Roth conversions before SS and RMDs kick in for two reasons: #1 - your taxes are going to go up significantly when one of you dies and the survivor has to file as a Single rather than MFJ; thus you need to take full advantage of the larger MFJ bracket that you're in right now; and #2 - your heirs will be much happier to inherit Roth IRAs from you than if they get traditional IRAs (because they will have to pay ordinary income tax rates on everything they take out, and those withdrawals have to occur within 10 years after the death of the last surviving spouse). The Roth IRA has the same 10 year distribution rule but of course no tax consequences on those withdrawals by your heirs.

  Post: Wrong Bucket

  Link to comment from February 7, 2022