@fretfulmother and @kiddie, hi to fellow Bay Staters. Back in Boston area next week.
@kiddie, I thnk she will not rent but will sell when she decides she can’t come anymore if no one wants the house. So, the email she sent out to the kids is designed to start a discussion about who if anyone wants the house. The money would go into the estate net of cap gains tax. It is possible that cap gains tax could be avoided if it transfers. I’m unsure about the tax treatment because the current structure leaves her with a life interest in the house and her two US-taxpaying kids as having a remainder interest as tenants in common. So, cap gains tax might well be owed anyway.
I took ShawWife to Tucson years ago and although I loved it, ShawWife said she never want to go there – too hot and too dry.
Lots of Nice places in Florida I agree I like the keys a lot. I may add Isalefora to and some other keys to the list of possibilities if you were on the East Coast they’re nice places up in Jupiter Farms and Stuart. It depends on what you want to be around water the parks. I don’t think I’d wanna be on a barrier island but it depends on how north that is
Trying to get 4 siblings to agree on a place in Florida sounds like herding cats to me. I would let the place be sold and the assets split if your mil decides she doesn’t want to go there anymore.
The only way I would buy on a barrier island in Florida is if I could get the place under market value unless it’s somewhere you really want to be.
You can find a place that is yours and yours only for the future. If that’s what you want.
This isn’t directed to @shawbridge but maybe it is.
I think our inclination is to fix something. Sometimes I think we need to step back and let it play itself out.
I know that a bunch of threads are being merged in my mind right now.
Retirement, investments and caring for our parents. This might not be the exact best place but sometimes I need to tell myself that I don’t need to fix other people’s problems. I don’t need to buy their house because they don’t want to take care of it anymore.
I don’t need to figure out how my mom should get her driver’s license. She needs to figure it out if she still wants to drive.
I don’t need to figure out how my kids buy a house or figure out how they should do something. Once they are financially independent and functioning adults.
The only person I need to fix things for is me. And my household.
Speaking of doing things for our household. I finally set up a meeting to figure out our trust and wills and all that as the kids are grown and things need to be done now!
It’s sometimes too easy to procrastinate and sometimes it’s the small things to feel accomplished lol
@deb922, I think we want to own a place on our own to go for four months a year. We know our island well (we’ve been coming here for 30 years) but I think I agree with the folks here that being on an island is not a great idea in a hurricane-prone state.
I think Florida markets generally have huge inventory and no buyers, so the prices are probably inflated. ShawWife and I talked about coming for a week to take care of her mother and then renting a place in another area to compare.
One of the things that makes buying more attractive than renting is the ability to leave things at the house and to have the same familiar things each time.
I say gain the familiarity with the area you like and then if you decide to purchase something, you can buy low. Friends of my parents did this - they purchased a condo in West Palm Beach FL, and when the market was low purchased a place which is Hobe Sound FL - water on both sides - sort of a strip that has maybe 20 properties on it - one side is ocean and the other side is inlet. Anyone who would buy her house would essentially be purchasing it for the property. One of her neighbors was a well-known professional golfer. I was on a boat inlet tour with my mom (we rented the condo) and got a rundown of some of the properties on the strip of land which we could see from the water.
Can see how your MIL’s place continues on and her decision to continue to use it. Take a while to decide - and what feels right for ShawWife and you.
It may be down the road instead of 4 months/year in FL being there 6 months and a day for lower overall taxes. Enjoy the best weather at both locations, and an art studio is easy to have in your own property.
Apologize for going a little farther from how much do you need topic-
If you look at many desirable areas in FL, I think you will find there are lots of buyers, and not way too much on the market. Population is still growing; some places are sold before MLS listing is published. Yes, real estate market not as hot in many places in FL as ‘22-‘24 but still hotter than ‘17-19.
If you are moving or splitting time with another state - You don’t have to live in FL 6 mo and a day to be able to be a resident and not pay state income tax- you have to be out of your other state more than 6 mo and a day. (and meet some other details). Travel can count as being out of other state. It’s the “other” state that wants to be able to collect state income tax.
My apologies if I took us off track. I was kind of thinking about the house as a investment decision (as well as a life choice) and you guys have actually helped me clarify my thinking. Florida probably still good; barrier island (as beautiful as it is) not such a wise idea in a hurricane-prone state.
I just sent my accountant the quirky deed and asked about the tax consequences of three possible scenarios (MIL sells house; MIL gives house to us and we sell; MIL holds onto the house until she passes and it goes to us and sib then and we sell).
I believe that @ib5 is correct that one does not have to be in any state for more than 6 months, but even if you are in one state for more than six months, one has to persuade MA that MA is no longer your tax domicile, which is easier said than done. See below.
@frefulmother, I believe that MA charges partial tax if you switch primary residences (tax domicile) during the year. Then you owe tax for the part of the year in which your primary residence was in MA. When we moved from NY, we paid partial tax to NY and partial tax to MA. Similarly, I think, if we sold our house in MA in June and moved to FL, we would owe tax for the first half of the year to MA but would not owe MA tax in following years.
I think the issue is if we retain a residence in MA but live there less than six months a year, it is possible to declare FL as a tax domicile. But, the good folks of MA Department of Revenue are highly suspicious because they don’t want to give up high taxpayers who are still living part of the year in the state. They will typically look at how many days you were in the state and as well at all kinds of indicia or primary residence. Where are your cars licensed? Where are your doctors? Synagogue or church? Your kids? Your sentimental objects? If they conclude that MA is still your real home, I think that they will charge you tax for the whole year and not just the partial tax. If it was partial, that would be great for me as I have always traveled a fair bit and without a FL house I used to be in MA less than half the year anyway. But, that would not be true for ShawWife who does not travel nearly as much as I (and I think the MA taxpayers might consider her location to be one of the indicia of primary residence). So, she would have to be out of MA for more than 6 months a year. Possible if we had a FL house with a studio and she spends a month or more in Canada (where we share a house).
But, I’m not planning to torque my life around for the tax (this may be short-sighted, I don’t know). I might be very happy to have done so when I have to take RMDs.
I am in MA and there are many snowbirds here who go to Florida for the winter. Since they have lived in MA most of their lives they keep it as their primary (vote here, register cars here, etc.) However, they all seem to count their days in each state very carefully for tax purposes.
Of course they know where your cars are licensed, but how could they actually know and track where your doctors, religious institutions and sentimental objects are? I don’t think any state government has the money and legal ability to hunt those answers down to tell you where you actually live. I have always thought the best answer to where one actually lives, is where is your dog?
The burden is on you to prove you have moved state. Otherwise the prior high tax state will just continue to bill you. CA certainly enquires into all these questions and you have to provide the evidence. I talked to someone a few years ago who moved to AZ for work, but they kept the old house in CA and his wife liked spending time there. He got billed for hundreds of thousands of dollars in back taxes from CA.
Generally speaking, the easiest option is to sell your former house and move to the new state. Or at least rent out your old house for a year or so. Once you’ve proven domicile, it’s not so problematic to buy a new “vacation” house in your old state or use the old house occasionally once your tenants move out.
CA taxes everything, but then provides an offset for income earned in other states. If your friend was earning income from an Arizona employer while living in Arizona, that would be excluded from income in CA.
fwiw: I have read on Bogleheads that NYS is ruthless in following snowbirds.
