Yesterday's Tractor Co.
Shop Now View Cart
   Allis Chalmers Case Farmall IH Ford 8N,9N,2N Ford
   Ferguson John Deere Massey Ferguson Minn. Moline Oliver
Classified Ads
Photo Ads
Tractor Parts

Discussion Forums
Project Journals
Tractor Town
Your Stories
Show & Pull Guide
Events Calendar
Hauling Schedule

Tractor Photos
Implement Photos
Vintage Photos
Help Identify
Parts & Pieces
Stuck & Troubled
Vintage Ads
Community Album
Photo Ad Archives

Research & Info
Tractor Registry
Tip of the Day
Safety Cartoons
Tractor Values
Serial Numbers
Tune-Up Guide
Paint Codes
List Prices
Production Nbrs
Tune-Up Specs
Torque Values
3-Point Specs

Tractor Games
Just For Kids
Virtual Show
Museum Guide
Memorial Page
Feedback Form

Yesterday's Tractors Facebook Page

Related Sites
Tractor Shed
Ford 8N/9N Club
Today's Tractors
Garden Tractors
Classic Trucks
Kountry Life
Tractor Talk Discussion Forum

Re: Real Estate taxes

[Show Entire Topic]  

Welcome Guest, Log in or Register
Author  [Modern View]
JD Seller

03-21-2013 01:59:40

Report to Moderator

It makes zero difference how you received the payment. You still will incur capitol gains if the land is selling for more than it was valued when it transfered into the trust. It will be figured on a per acre basis. So if ten acres sold and covered $10,000 of taxes and it was valued at $2500 when it went into the trust, there would be income of $7500 that would be subject to capitol gains. The form of payment makes no difference. You still received $10,000 of benefit. The biggest part just went to pay delinquent taxes.

Think about it this way. You are selling the land for the amount of the taxes plus some closing fees. This is still income. It just is being diverted to pay the taxes on the whole property.

Before this deal closes you need to talk to a tax person in your location. You may sell the property and have the taxes paid but then own the IRS the capitol gains tax.

I saw this happen to guys in the 1980s. They went broke. They gave the farm back to the bank. The bank took the ground back for the amount owed on it. The guys did not file bankruptcy. The IRS considered it sale with the bank being a buy with the purchase amount/price being the loan payoff amount.

Here is how they incurred a tax bill. They originally bought the ground for lets say $1000. The land increased in value but they did not sell it they used the addition value as collateral at the bank. The bank loaned them money based on this increased value. So let that value be $2000. The farmer spent the money on whatever and then could not make his payments. So the bank took the farm back. In the IRS's eyes the bank paid $2000 for the land. The farmer owed capitol gains on the $1000 increase in the land value.

Two different guy I know had to declare bankruptcy after they voluntarily signed their farms back to the bank because of tax issues. One was hit with a $350,000 tax bill on the capitol gains and the write off FHA did that was counted as income as well.

[Log in to Reply]   [No Email]

03-21-2013 07:42:58

Report to Moderator
 Re: Real Estate taxes in reply to JD Seller, 03-21-2013 01:59:40  
Same thing is going on with some foreclosed homes I have heard.

[Log in to Reply]  [No Email]
[Show Entire Topic]     [Options]  [Printer Friendly]  [Posting Help]  [Return to Forum]   [Log in to Reply]

Hop to:

Fast Shipping!  Most of our stocked parts ship within 24 hours (M-Th). Expedited shipping available, just call! Most prices for parts and manuals are below our competitors. Compare our super low shipping rates! We have the parts you need to repair your tractor. We are a company you can trust and have generous return policies. Shop Online Today or call our friendly sales staff toll free (800) 853-2651. [ About Us ]

Home  |  Forums

Copyright © 1997-2016 Yesterday's Tractor Co.

All Rights Reserved. Reproduction of any part of this website, including design and content, without written permission is strictly prohibited. Trade Marks and Trade Names contained and used in this Website are those of others, and are used in this Website in a descriptive sense to refer to the products of others. Use of this Web site constitutes acceptance of our User Agreement and Privacy Policy

TRADEMARK DISCLAIMER: Tradenames and Trademarks referred to within Yesterday's Tractor Co. products and within the Yesterday's Tractor Co. websites are the property of their respective trademark holders. None of these trademark holders are affiliated with Yesterday's Tractor Co., our products, or our website nor are we sponsored by them. John Deere and its logos are the registered trademarks of the John Deere Corporation. Agco, Agco Allis, White, Massey Ferguson and their logos are the registered trademarks of AGCO Corporation. Case, Case-IH, Farmall, International Harvester, New Holland and their logos are registered trademarks of CNH Global N.V.

Yesterday's Tractors - Antique Tractor Headquarters