Ouch!!! The Proposed Elimination of the Step-Up and the Carry-Over Capital Gains Tax Basis

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Major changes are being proposed in Congress to both the carry-over basis rules for appreciated assets that are donated to a donee during the donor's lifetime, and to the step-up in basis rules for appreciated assets that are inherited when someone dies.

[@kevins8575]

The congress is doing exactly what they said they would do: take all the assets from people who worked and saved, and give it to the people who failed to provide for themselves and their families.

[@59jm24]

This is exactly how the rich accumulate major wealth.

[@TheHouseofSniffers]

I am not rich but I worked hard to provide a roof for my family. My house should remain with my heirs and not grabbed away through tax. My kids cant afford the tax to keep it. Something millenials 'give me' generation dont understand.

[@alicemoraldenis4286]

@@59jm24 wealth many busted their a$$ for, and it’s not ok, the current administration wants to implement this to cover their huge trillion dollar budgets for all the things that they feel is justified, not even a vote from the people on funding allocation, plus with millions coming in thru our open borders, the current admin needs to impose these unjust tax laws to support all these millions of individuals that walked across the border and now will need gov assistance for housing, health insurance, food, utilities, etc. I want to be fair but the people of this country are currently not the priority, we will be like individual banks supporting all these huge expenses that are not open for discussion not very transparent, it’s just unthinkable

[@kayakutah]

@@59jm24 Yeah, when I leave my kids $100,000 each from a house that appreciated 50%, it's really important that they don't get rich off of it!

[@mv-db4463]

@@59jm24 What is your point ????

[@brianrajala7671]

Government is basically confiscating family property under these proposals.

[@cavscout888]

That's probably their intent. Their masters want to own all the property that they'll then rent to all of us for the most reliable/interconnected passive income scheme in world history. This is what they want with the 'Great Reset' and how they plan to 'Build Back Better.'

[@dmiller1000]

What can you honestly expect when you have Bernie Sanders, an avowed socialist, writing tax law? I didn't vote for this.

[@silverwings8253]

I sure hope this does not pass. I can only imagine how many heirs will have to sell the property left to them by their parents to pay the taxes and end up with no home left to them in the end. I've worked over 30 years to pay for my home and its a sad day when my child won't be able to enjoy our family home because they don't make enough to pay the taxes on the home.

[@justinh6974]

Many farmers already have this issue with farm land being so pricey they cant pay the taxes due and are forced to sell after a great grandparent bought it with there life savings 100 years ago. China now owns a lot of U.S. farmland. Unbelievable!

[@bucko1948]

@@justinh6974 This could have been solved with life insurance....only problem is so many so-called "financial planners" are focused only upon portfolio growth and ignorant as to what life insurance is all about. Example. Take out a new mortgage. Put money into a life insurance policy. Make the mortgage payments via the life insurance policy. Upon death, use the life insurance proceeds that are tax free to pay the mortgage or taxes. BTW, there is a 12.5 million dollar estate tax exemption. I'm not an expert, but I do know a lot. Check with an estate planning attorney who knows what you can do with life insurance. And PS, no, I am not an insurance agent. I don't remember if this new mortgage brings a new stepped-up basis. Use the exemption for home sales. If so, sell to a controlled entity. Again, any decent financial planner should know this.....but they don't.

[@priestesslucy3299]

This sad reality is one step closer as of this march when Irrevocable Trusts lost Step-Up Basis. If Step-up Basis goes away entirely then the only way to mitigate capital gains eating your home will be to sell it yourself in ways that mitigate capital gains (such as the 250,000$ exemption that hasn't been adjusted for inflation in decades >_>)

[@jamesodell3064]

This would adversely affect many member of the House and Senate, Democrat and Republican. Their own greed will hopefully prevent this.

[@jamesladd471]

Not if they exempt themselves

[@Corkfish1]

@@jamesladd471 even these days that would be a long shot. You also have to consider all the CEOs who help fund their campaigns. They don't want it either.

[@coloradoblue262rodeo3]

@@Corkfish1 This is exactly correct. I think Rabalais is a great guy and clearly provides a great service and he seems smart, but I too agree there are real issues with the video's timeliness and updates with legislation in this video. Why? 1) No reference was made to the House Ways & Means vote on (Sept. 16, 2021)and the final Draft proposal (which of course can be changed later if they want to). Why is this important? This House Dem W&M draft did not even take up the question of step up basis, largely because Richard Neal (the House Ways & Means Chairman) said there was a great deal of pushback from rural Dems in Congress (including David Scott D-GA, AG Chairman) who were against ending step up basis and realization at death. They need to get 218 votes, and he said they didn't have them for full step up repeal. As such, they didn't even vote on repealing it and they didn't include it in the W&M draft. This caused great frustration among progressives in Senate and house who still want a change. But, fast forward a week or so later, Ron Wyden (Senate Finance Chairman), Ron Wyden (House Ways & Means Chairman), Pelosi, and Schumer, met with Biden in White House to discuss a secret menu of options for potential tax increases to pay for Build Back Better Bill. Again, step up basis repeal was NOT included in this loose "framework" agreement. Remember, the Dems only have a 3 seat safety seat threshold in house and zero room for error in the tied 50-50 Senate, put simply they can't lose any support or votes. Almost 12-15 Dems in House and at least 1-2 in Senate (John Tester, perhaps Manchin or Sinema) are against step up repeal to my knowledge. I even called multiple Dem Congressmen/women and they too are against ending step up. Tester is strong on this issue and very vocal about it. As of September 14, 2021, "Senator Jon Tester of Montana, a Democratic moderate, said through a spokesman that none of the inheritance-transfer tax proposals he has been offered so far are acceptable and he will continue to oppose them on behalf of family farms, ranches, and small businesses." Also, when asked about why step up basis was not on the list of menu options in White House September 24, 2021, Democratic Chairman Richard Neal quickly said he had "no interest" in rekindling the debate on Stepped up basis and at the moment (no) it was not on the menu. A day later, Biden pivoted and called for taxed unrealized gains annually on billionaire appreciated earnings annually (i.e. Wyden plan) due in large part to his earlier failure to garner enough support for the alternative plan i.e. step up basis repeal. Although everything is still on table and it would be silly to not prepare, I find it weird that this video doesn't address these important developments. It makes me wonder if 1) Rabalais is using information from headlines in Spring 2021, or 2) if he knows something we don't, or has access to Congress now? Can he or anyone clarify? Thoughts? I really want to know.

[@jamesodell3064]

@@jamesladd471 Perhaps Congress members exemption from insider trading laws.

[@dos-fslady3140]

@@coloradoblue262rodeo3 Hey neighbor! Thanks so much for taking the time to post so much relevant and valuable information. I've worked since I was 16 with no college -- but have managed to amass a tidy sum due to extreme sacrifice and investing, and I care very much about where this money is going, and how it will be used. Warmest regards to you from Albuquerque

[@nikitakucherov5028]

Congrats overall society…. This is the politicians YOU voted in.

[@davidpatton7298]

And keep sending your kids to the most pretigious socialist/marxist indoctrination centers for their minds and hearts to be weaponized against personal freedom and accountability.

[@mwduck]

Yes, the liberals are trying to tax the middle class out of existence.

[@markreichart6482]

This is what happens you order a President through the mail....

[@DEAH-01]

@@markreichart6482 exactly !

[@jcvchristianson1161]

Seriously? You've watched the elections since 2000 and you still believe they are legit? WE didn't vote anyone in.

[@Retiredmco]

Thank a DEMOCRAT!!!

[@barblibrarian]

He specifically stated it was supported by both sides of the aisle. Must be a pretty egregious tax loophole if both parties support the change.

[@Retiredmco]

@@barblibrarian But what party is supporting it the most??? Barb has a illness #LiberalismisaMentalDisorder !!!!Thought so!!

[@andrewweber2010]

@@barblibrarian He specifically does NOT say it supported by both sides of the aisle. He says specifically that there are proposals in both the House and Senate. BOTH of these proposals are proposed by the indolent, thieving Democrats. Republicans are not parasitic socialists, Democrats are. Listen closer next time!!!

[@coloradoblue262rodeo3]

@@barblibrarian it's not supported by both sides of the isle, even some democrats are uncomfortable with it. Yet again, Rabalais didn't even talk about it. Very confusing.

[@bobbissell2910]

Keeps getting better every f day

[@helmuttdvm]

Record keeping could be near impossible for assets owned for generations, and basis costs should also be adjusted for inflation. In reality, it’s just another tax grab that most people won’t realize until it hits them!

[@dirtyzardian]

Jeez, we don't tax people enough. Let's find new and creative ways to tax every single aspect of ones life and death. Basically saying that no matter what you earn in your life the government thinks they deserve it. Let me ask you this? Did the dad pay tax when he bought the property, I'm guessing yes? Government you are not owed tax every time something is gifted or inherited. Tax was already paid on this property and property tax was paid through out the time the property was owned. Enough is enough.

[@cavscout888]

We lose about 50% of our wages to taxes. 25% from Fed and state income and SS and FICA/med, then another ~7% in sales tax on all things, annual taxes on vehicles, annual taxes on property, but then lastly a huge cherry on top of all the taxes that companies actually selling goods and services have to pay also, which is all rolled into the cost of the product or service and we pay it.

[@d6c10k4]

If passed this would destroy family farms. A farm your parents bought in the 1950s for $50,000 could easily be worth 2 million on paper, but still only produces income for a modest living. Most small farmers are land rich and cash poor. In my example, if you inherited a $2 million dollar farm you'd owe 25% on the amount over the 1million$ exemption. ($250,00). Very few small farmers are going to have that kind of cash and will end up having to sell off a significant part of the farm to pay the tax. Then they're left with a farm that produces even less income. It's a death spiral.

[@HB-yq8gy]

Sad sniffy Joe & Dems hate capitalism.

[@coloradoblue262rodeo3]

This is exactly correct. I think Rabalais is a great guy and clearly provides a great service and he seems smart, but I too agree there are real issues with the video's timeliness and updates with legislation in this video. Why? 1) No reference was made to the House Ways & Means vote on (Sept. 16, 2021)and the final Draft proposal (which of course can be changed later if they want to). Why is this important? This House Dem W&M draft did not even take up the question of step up basis, largely because Richard Neal (the House Ways & Means Chairman) said there was a great deal of pushback from rural Dems in Congress (including David Scott D-GA, AG Chairman) who were against ending step up basis and realization at death. They need to get 218 votes, and he said they didn't have them for full step up repeal. As such, they didn't even vote on repealing it and they didn't include it in the W&M draft. This caused great frustration among progressives in Senate and house who still want a change. But, fast forward a week or so later, Ron Wyden (Senate Finance Chairman), Ron Wyden (House Ways & Means Chairman), Pelosi, and Schumer, met with Biden in White House to discuss a secret menu of options for potential tax increases to pay for Build Back Better Bill. Again, step up basis repeal was NOT included in this loose "framework" agreement. Remember, the Dems only have a 3 seat safety seat threshold in house and zero room for error in the tied 50-50 Senate, put simply they can't lose any support or votes. Almost 12-15 Dems in House and at least 1-2 in Senate (John Tester, perhaps Manchin or Sinema) are against step up repeal to my knowledge. I even called multiple Dem Congressmen/women and they too are against ending step up. Tester is strong on this issue and very vocal about it. As of September 14, 2021, "Senator Jon Tester of Montana, a Democratic moderate, said through a spokesman that none of the inheritance-transfer tax proposals he has been offered so far are acceptable and he will continue to oppose them on behalf of family farms, ranches, and small businesses." Also, when asked about why step up basis was not on the list of menu options in White House September 24, 2021, Democratic Chairman Richard Neal quickly said he had "no interest" in rekindling the debate on Stepped up basis and at the moment (no) it was not on the menu. A day later, Biden pivoted and called for taxed unrealized gains annually on billionaire appreciated earnings annually (i.e. Wyden plan) due in large part to his earlier failure to garner enough support for the alternative plan i.e. step up basis repeal. Although everything is still on table and it would be silly to not prepare, I find it weird that this video doesn't address these important developments. It makes me wonder if 1) Rabalais is using information from headlines in Spring 2021, or 2) if he knows something we don't, or has access to Congress now? Can he or anyone clarify? Thoughts? I really want to know.

[@12131bear]

Thanks to those people who voted for democrats.

[@jonthornburg8193]

Lets push that the proposed legislation does NOT pass!

[@barblibrarian]

Based on what? Why shouldn’t tax be owed in these situations? You and I are subsidizing gifts the rich give their children. Why?

[@scottsienkiewicz8371]

@@barblibrarian Some people would like to keep their hard earned money and property in the family.

[@ladyfreddie7513]

@@scottsienkiewicz8371 simple isn’t it. You are so right.

[@andrewweber2010]

@@barblibrarian You forget about small business owners and farmers.

[@kend4438]

@@barblibrarian I doubt you are subsidizing the rich. Given all the taxes they pay already, it is they who are subsidizing you.

[@MooseDung16]

What are the bill numbers? We all should be writing opposition letters to our Congressmen and Senators, but we need the bill numbers.

[@jakoshin4702]

Thank you Mr. Rabalais. When is this expected to pass and when is this going into effect?

[@lizcoleman5229]

Hoping this does not pass.... They are making all these changes like now talking about controlling transactions over $600 that are ridiculous. Enough is enough

[@HB-yq8gy]

Thanks, great job explaining a difficult subject. Even more so now to die with zero.

[@dodgerblue7381]

Let's go Brandon!!!!!!

[@ladybug1630]

❤

[@markreichart6482]

This is very informative but how do you know what's being proposed in each house? I cannot find one other current article regarding these very important proposals. A link to your source would be much appreciated.

[@mistermister8998]

Thanks, Democrats! 🤬🤬🤬

[@lp8380]

Great video, thank you!

[@mb-3faze]

So basically, all real estate will need to be sold on death and dependents will have to move out.

[@gilbrook]

For sure. Thx for commenting on this potential legislation.

[@pinnednomadicfanatic2547]

I have something new for you 😊🚀⛔🚀😊

[@pinnednomadicfanatic2547]

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[@pinnednomadicfanatic2547]

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[@lfrost6718]

All Good here. If I'm listening correctly. Since I will never have more than one million to gift or give as an inheritance. Plus, I was reading that they this may not be passed since so many farmers pass down land to family.

[@glasshalffull8625]

Any word on if this will be retroactive?

[@rogerpullin8997]

What you are saying, the day may come when I can not afford to die

[@ramman347]

Wow. And so it begins. Our legislators looking out for only tax rolls.

[@georgesologuren8535]

I read the May 2021 proposal put out by the Department of the Treasury. Is there a more current proposal? The May 2021 proposal had a one million dollar exemption for estate and gift. Also as I read it when you file the estate return only appreciated property is used to compute Capital Gains on the Estate's side; loss stay with the decedents final return along with loss carryforward; any losses remaining on the final return is lost. Am I reading this correctly. Just started watching you; love your stuff

[@coloradoblue262rodeo3]

This is exactly correct, and I was thinking same thing. I think Rabalais is a great guy and clearly provides a great service and he seems smart, but I too agree there are real issues with the video's timeliness and updates with legislation in this video. Why? 1) No reference was made to the House Ways & Means vote on (Sept. 16, 2021)and the final Draft proposal (which of course can be changed later if they want to). Why is this important? This House Dem W&M draft did not even take up the question of step up basis, largely because Richard Neal (the House Ways & Means Chairman) said there was a great deal of pushback from rural Dems in Congress (including David Scott D-GA, AG Chairman) who were against ending step up basis and realization at death. They need to get 218 votes, and he said they didn't have them for full step up repeal. As such, they didn't even vote on repealing it and they didn't include it in the W&M draft. This caused great frustration among progressives in Senate and house who still want a change. But, fast forward a week or so later, Ron Wyden (Senate Finance Chairman), Ron Wyden (House Ways & Means Chairman), Pelosi, and Schumer, met with Biden in White House to discuss a secret menu of options for potential tax increases to pay for Build Back Better Bill. Again, step up basis repeal was NOT included in this loose "framework" agreement. Remember, the Dems only have a 3 seat safety seat threshold in house and zero room for error in the tied 50-50 Senate, put simply they can't lose any support or votes. Almost 12-15 Dems in House and at least 1-2 in Senate (John Tester, perhaps Manchin or Sinema) are against step up repeal to my knowledge. I even called multiple Dem Congressmen/women and they too are against ending step up. Tester is strong on this issue and very vocal about it. As of September 14, 2021, "Senator Jon Tester of Montana, a Democratic moderate, said through a spokesman that none of the inheritance-transfer tax proposals he has been offered so far are acceptable and he will continue to oppose them on behalf of family farms, ranches, and small businesses." Also, when asked about why step up basis was not on the list of menu options in White House September 24, 2021, Democratic Chairman Richard Neal quickly said he had "no interest" in rekindling the debate on Stepped up basis and at the moment (no) it was not on the menu. A day later, Biden pivoted and called for taxed unrealized gains annually on billionaire appreciated earnings annually (i.e. Wyden plan) due in large part to his earlier failure to garner enough support for the alternative plan i.e. step up basis repeal. Although everything is still on table and it would be silly to not prepare, I find it weird that this video doesn't address these important developments. It makes me wonder if 1) Rabalais is using information from headlines in Spring 2021, or 2) if he knows something we don't, or has access to Congress now? Can he or anyone clarify? Thoughts? I really want to know.

[@brianrajala7671]

With inflation being what it is a million $$$ is not beyond what average people can accumulate in a lifetime. The government must get over the idea it is up to them to take care of everyone. That is what planning for our own futures is about.

[@chris-malek]

Great videos. Keep it up. Love it

[@bobbissell2910]

You will own nothing and be happy.

[@jones3781]

Why didn't you include the $1,000,000 exemption in the example you gave? If you had, then the son would not owe any tax on the $200,000 property when the dad died. If I am wrong, please explain.

[@cherylskates]

Will people with existing stepped up basis be grandfathered in if this law passes?

[@marilyncole3560]

You mentioned something about assets that were transferred to a revocable living trust and if the person inherits from the revocable living trust is that exempt? What if you inherited a house two years ago and did not sell it but kept it and now you want to sell it. Before you paid the tax on the difference of the value at the time of death and the and the sale price. How would that be with the new proposal? Or because the death was two years ago it would be under the different ruling? So should you sell the property now before the change starts

[@arubajoseph]

Hey Paul - Great video. If these go into effect, what happens to a house that’s in a life estate & a house that’s in trust?

[@matthewcasady6276]

I doubt the limits are set as low as 100 thousand and 1 million by the time it is signed into law.

[@747-pilot]

Personally, I don’t even think these things will pass. Joe Manchin and Kristin Sinema (“blue dog Democrats”) will most likely not be on board with this. There is a small chance they might get on board if the limits are raised significantly, as you say.

[@MellowGreetings]

How can we expect brokerages to deal with Transfer On Death (TOD) accounts? Will they liquidate all assets, withhold the taxes for the executor to deal with, and then distribute what's left in an equitable fashion to the beneficiaries? Or will they carve up the assets and distribute them untaxed to the beneficiaries, leaving some with a bigger tax burden than others?

[@atc404770]

Well, I guess I’ll only leave my inheritance to my conservative kids then since taxes are going to take more of it.

[@TheGregWallace]

Have them start a charity.

[@thefunteacher8662]

Oh no. Oh no no no.

[@rapfreak7797]

Great that people are potentially going to be taxed on gains that are largely driven by inflation. Those who spend wisely and saved are being punished; the ants are being forced to feed the grasshoppers.

[@walterconn5637]

Thanks for doing these videos. My first thought is to blame inflation. For example, my house is not as nice as it was when it was new, but the value has gone up. Also, it will be interesting to find out the unintended consequences of these laws. For example, people will want to invest in something tax free to protect themselves from inflation. There will probably untraditional ways to invest that will become more popular. My second thought is that people need to have their children either become a tax accountant, lawyer or estate planner (or marry one). The politicians think that they will get a lot more tax revenue, but people will find out how to avoid it.

[@pinnednomadicfanatic2547]

I have something new for you 🚀⛔😊⛔⛔

[@pinnednomadicfanatic2547]

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[@pinnednomadicfanatic2547]

Available on WhatsApp

[@walterconn5637]

If you need advice, just ask in the comments. You are not the real you tuber, correct?

[@walterconn5637]

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[@davidwalker2781]

What Specifically should we be paying attention too, in regards to the proposed legislation actually Passing or Failing? Is there a bill # for the House or Senate versions, or a specific Name to these bills.... With just 1/2 of November & December left,.... how likely is it, that the House version or Senate version truly passes and Changes the rules, and it's all signed, sealed, and delivered.

[@markslauson4584]

I have multiple homes I’ve bought in the last few years. I’ve had good returns but the gain on each home is under the

[@martinlight3022]

Will this kill "Family Owned Businesses" & "Family Owned Farms"?

[@rccalhoun]

step up basis is unfair.

[@rvnmedic2709]

Is there a provision for farms and/or agricultural properties?

[@nightdipper5178]

At least for now this is dead. The House Ways and Means Committee released its tax package without inclusion of the proposal.

[@carolmaplesden916]

thank you for an update i will follow up on it

[@kithall1]

Who determines what the actual basis IS at the time of death and how is it calculated?

[@juanantonioleon8571]

I like u videos so much.

[@geniferteal4178]

How about correcting the value for inflation first? Isn't that where much of the increase in value comes from? What about home improvements? You could double the size also "doubling your investment". Then you get taxed on the new value? Both feel like robbery.

[@jed7644]

Anything to suck taxes out of people who don’t have the money for taxes in place of taxing those who do.

[@ericbatres3511]

Thank you for the information regarding this tax situation 👍❗️

[@coloradoblue262rodeo3]

You might find this interesting. I wrote above that I think Rabalais is a great guy and clearly provides a great service and he seems smart, but I too agree there are real issues with the video's timeliness and updates with legislation in this video. Why? 1) No reference was made to the House Ways & Means vote on (Sept. 16, 2021)and the final Draft proposal (which of course can be changed later if they want to). Why is this important? This House Dem W&M draft did not even take up the question of step up basis, largely because Richard Neal (the House Ways & Means Chairman) said there was a great deal of pushback from rural Dems in Congress (including David Scott D-GA, AG Chairman) who were against ending step up basis and realization at death. They need to get 218 votes, and he said they didn't have them for full step up repeal. As such, they didn't even vote on repealing it and they didn't include it in the W&M draft. This caused great frustration among progressives in Senate and house who still want a change. But, fast forward a week or so later, Ron Wyden (Senate Finance Chairman), Ron Wyden (House Ways & Means Chairman), Pelosi, and Schumer, met with Biden in White House to discuss a secret menu of options for potential tax increases to pay for Build Back Better Bill. Again, step up basis repeal was NOT included in this loose "framework" agreement. Remember, the Dems only have a 3 seat safety seat threshold in house and zero room for error in the tied 50-50 Senate, put simply they can't lose any support or votes. Almost 12-15 Dems in House and at least 1-2 in Senate (John Tester, perhaps Manchin or Sinema) are against step up repeal to my knowledge. I even called multiple Dem Congressmen/women and they too are against ending step up. Tester is strong on this issue and very vocal about it. As of September 14, 2021, "Senator Jon Tester of Montana, a Democratic moderate, said through a spokesman that none of the inheritance-transfer tax proposals he has been offered so far are acceptable and he will continue to oppose them on behalf of family farms, ranches, and small businesses." Also, when asked about why step up basis was not on the list of menu options in White House September 24, 2021, Democratic Chairman Richard Neal quickly said he had "no interest" in rekindling the debate on Stepped up basis and at the moment (no) it was not on the menu. A day later, Biden pivoted and called for taxed unrealized gains annually on billionaire appreciated earnings annually (i.e. Wyden plan) due in large part to his earlier failure to garner enough support for the alternative plan i.e. step up basis repeal. Although everything is still on table and it would be silly to not prepare, I find it weird that this video doesn't address these important developments. It makes me wonder if 1) Rabalais is using information from headlines in Spring 2021, or 2) if he knows something we don't, or has access to Congress now? Can he or anyone clarify? Thoughts? I really want to know.

[@NeedsMoreToys]

Wow that’s significant

[@pinnednomadicfanatic2547]

I have something new for you 😊🚀⛔🚀😊

[@pinnednomadicfanatic2547]

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[@pinnednomadicfanatic2547]

Available on WhatsApp

[@paulcali08]

Does the Home Sale Exclusion need to be taken into consideration, or is it even a factor, if I had a Date of Death Appraisal on the house I inherited from my father? I've lived in the house for many years with my father, I sold the house 8 months after taking official ownership and I sold it for less than the appraised value. Am I correct to believe I am exempt from capital gains tax on this sale?

[@ericchang7706]

If this passes, you'll see a boom in limited partnership and LLC entities for holding assets so the units can be discounted for illiquidity and passed $15k/yr to one's children. At least that's what I'll do with my mark-to-market assets. It's going to be a paperwork nightmare. Thank you so much for sharing this. Please continue to update.

[@billjacobi9764]

THEY GOT U COMEING AND GOING. 🤧

[@coloradoblue262rodeo3]

I'm confused. I think Rabalais is a great guy and clearly provides a great service and he seems smart, but I too agree there are real issues with the video's timeliness and updates with legislation in this video. Why? 1) No reference was made to the House Ways & Means vote on (Sept. 16, 2021)and the final Draft proposal (which of course can be changed later if they want to). Why is this important? This House Dem W&M draft did not even take up the question of step up basis, largely because Richard Neal (the House Ways & Means Chairman) said there was a great deal of pushback from rural Dems in Congress (including David Scott D-GA, AG Chairman) who were against ending step up basis and realization at death. They need to get 218 votes, and he said they didn't have them for full step up repeal. As such, they didn't even vote on repealing it and they didn't include it in the W&M draft. This caused great frustration among progressives in Senate and house who still want a change. But, fast forward a week or so later, Ron Wyden (Senate Finance Chairman), Ron Wyden (House Ways & Means Chairman), Pelosi, and Schumer, met with Biden in White House to discuss a secret menu of options for potential tax increases to pay for Build Back Better Bill. Again, step up basis repeal was NOT included in this loose "framework" agreement. Remember, the Dems only have a 3 seat safety seat threshold in house and zero room for error in the tied 50-50 Senate, put simply they can't lose any support or votes. Almost 12-15 Dems in House and at least 1-2 in Senate (John Tester, perhaps Manchin or Sinema) are against step up repeal to my knowledge. I even called multiple Dem Congressmen/women and they too are against ending step up. Tester is strong on this issue and very vocal about it. As of September 14, 2021, "Senator Jon Tester of Montana, a Democratic moderate, said through a spokesman that none of the inheritance-transfer tax proposals he has been offered so far are acceptable and he will continue to oppose them on behalf of family farms, ranches, and small businesses." Also, when asked about why step up basis was not on the list of menu options in White House September 24, 2021, Democratic Chairman Richard Neal quickly said he had "no interest" in rekindling the debate on Stepped up basis and at the moment (no) it was not on the menu. A day later, Biden pivoted and called for taxed unrealized gains annually on billionaire appreciated earnings annually (i.e. Wyden plan) due in large part to his earlier failure to garner enough support for the alternative plan i.e. step up basis repeal. Although everything is still on table and it would be silly to not prepare, I find it weird that this video doesn't address these important developments. It makes me wonder if 1) Rabalais is using information from headlines in Spring 2021, or 2) if he knows something we don't, or has access to Congress now? Can he or anyone clarify? Thoughts? I really want to know.

[@backyardpc1656]

@@coloradoblue262rodeo3 I will give you the bottom line that I see. Marxist, Democrats are using every tool in their arsenal to put the middle class out of business, especially farmers and ranchers. You know this "tax the rich" is not about the rich at all. It is about destroying the middle class, which "taxing the rich" will eventually accomplish.

[@jenna.w.9041]

What if the property is conveyed from the originating trust to the recipient’s trust?

[@ticktock2383]

Create your own charity. Give the valuables to the charity at your death. Charity sells assets. The rich do this all the time.

[@vhufeosqap]

Gross

[@virginiatonelli4479]

Hi Paul. We sold our passed sisters home for much more than it was worth 2.5 years ago. But, how do we prove to the IRS how much it was worth 2.5 years ago. Appraisers are so far being difficult to come by and are charging quite a bit. Will MLS comparables from 2.5 years ago satisfy the IRS? What else? Thanks.

[@KanataVIP]

This is how it works in Canada. When you die, you are deemed to have disposed of your assets. To a Canadian, the idea that you can pass on an estate with $12M in assets and unrealized capital gains tax-free and with a step-up in basis to an heir sounds like an unfair advantage to families with that level of assets. These videos do an excellent job of explaining some of the important rules regarding estates.

[@budubeebobop]

No one i know is rich by amy means or puchased any 1.2m property but maybe some cheap out in the mifdle of nowhere property that is now worth more. The idea is that would be for retirement (as part ofntkaing care of yourself not relying on government to make those decisions for you) OR perhaps leaving to your family to help THEM get ahead

[@mb-3faze]

So, in Canada, for example, when your mother (now widowed) is living in a house in West Vancouver purchased for $50k, now worth $2.5million, gets run over by a bus, the kids have to sell the house to pay 40% tax on just under $2.5million?

[@KanataVIP]

@@mb-3faze In Canada a personal residence is not subject to capital gains, even if it's a $45M property. Three should be a limit on this exemption.

[@mb-3faze]

@@KanataVIP Same as the UK but not in the States. It's a bizarre situation but through no fault of my own I cannot move and buy a similar primary residence in a different part of the country because I can't afford to pay the million or so in tax. There is a primary residence exemption but that is woefully behind the property inflation index.

[@KanataVIP]

@@mb-3faze The USA used to have a provision where the gain on a house was not immediately taxable if you bought another house of equal or greater value. Makes sense. Not sure if it still exists.

[@DPearls24]

So the bottom line is that inherited property is taxed as a Cap Gains. Does the estate pay the tax or the receiver (who is also the estate)? How does that work out? Property bought at $50k, appreciates to $500k. It goes to the estate when the surviving spouse passes. That would mean the estate pays taxes on the $450k of gains?

[@03bruisercat]

Except currently proposed rule has a $1m exemption, so it would not apply to your fact pattern.

[@casper24ism]

You said a revocable trust will protect the elemination of stepped up in basis? I cant find that anywhere can you please explain?

[@Corkfish1]

A revocable trust doesn't change the ownership. You're basically transferring ownership to yourself so it wouldn't trigger anything

[@Omikoshi78]

Most kids these days can’t afford a starter home because the house price keeps snowballing across generations. If this doesn’t pass now. It will have to pass eventually or else we’ll end up with a caste system. Edit: A humble perspective from a multi-millionaire who has everything to lose if this passes.

[@bobcathymattson6065]

So, if the majority of the properties owned are within a revokeable living trust, and the kids become the replacement trustees of the trust upon the parents death, would that be exempt from the new capital gains? Wow! all of this estate planning looks like it is down the toilet if this stuff passes. Cheers!

[@therealtimray]

Wow, what a terrible way to prevent any family from ever having the opportunity to build generational wealth?

[@glasslinger]

This was the intent of the legislation. These generational billionaires are in power due to their ancestors luck, not because they deserve the billions! The lower limit will allow small farms and businesses to be exempt. Also family homes.

[@therealtimray]

@@glasslinger it seems to be geared to prevent any other families from being able to get out of poverty. The families who have previously "made it" will be just fine. But current families in poverty will find it even harder to build family wealth. A very sad day indeed.

[@jjyemg2397]

so what's the new strategy? Put all your family members on the title/deed?

[@silverbackag9790]

Sell, leave, get a second citizenship, renounce US citizenship. Fuck living under this shit.

[@ProgressiveAF]

I inherited a house in Oct 2020 but didn't sell it until April 2021. Does that mean I will take the hit in taxes when I file in 2022?

[@georgesologuren8535]

No Tricia you won't and you know the reason why.🙂

[@billlin9656]

This is a year old video. What the status of the proposed elimination of step-up now (2023)? It is very sad news if the rule is passed.

[@joanneconklin4505]

So this is disturbing!! My two sister & I were added to my parents home deed in 2020. Dad passed in 2018; Mom still living, barely. If Mom passes after this stupidity is enacted, how are we impacted when proceeds of the sale of that home are split 3 ways (intended to BE split 3ways….)? Home sale estimated at $700,000 (6 acres + house); original purchase price =

[@1pcmedic]

Never knew Democrats had so many arms did you..................

[@joepfeiler5911]

First1 million doller gain would have not tax. You are not affected by it.

[@ticktock2383]

Read my suggestion to form your own charity, above.

[@JohnWisconsin]

Get off the deed (unless you're afraid Mom will need to spend it on a nursing home). Get on a Transfer on Death Deed so the step up takes place after she passes. Looks to me that you're currently in line to pay that capital gain upon sale.

[@gingercox6468]

Ten doesnt go to 200 without improvements. Those improvements had been taxes already. Taxes were paid all along. Why are we paying tax multiple times?

[@PrettyGoodLookin]

Hell No !! Haven't ya'll had enough at this point paying Taxes on Everything !? This idea is the last straw !! We need to take back our country and our Freedom.

[@MSDOGS1976]

I'll be shocked if this passes. But who knows............

[@747-pilot]

99% it won’t. It’s not like Democrats have a huge majority in the Senate. There are 2 obstacles: Joe Manchin and Kristen Sinema, both “blue dog Democrats”. It’s going to take a lot of concessions to get them on board!

[@chrischamberlain7628]

So many other things have passed I thought wouldn’t. California now has statewide rent control, and now SB9 & SB10 have passed where they can destroy single family neighborhoods. I didn’t think either of these would pass. The voters voted for no rent control, but Newsom passed it anyway, and then signed in SB9 & 10 the very next day after he wasn’t recalled.

[@747-pilot]

@@chrischamberlain7628 California is not the USA, and the USA is not California (I'm originally from SoCal, BTW - Torrance). California is a very deep blue State, and that is why myself, my brother etc. left Cali for Texas. We are not fools, and we are not fooling ourselves. California is beyond help! People are beyond delusional! That is why I thought the recall was a huge waste of time, effort and money. Time, effort and money that could have been spent more usefully on other conservative causes!!! Does anyone in their right mind think they have a hell in a handbasket chance of winning in highly partisan State with Democrat supermajorities?? (rollseyes), especially with someone like Larry Elder running in opposition?? If they had run a moderate Republican, like Kevin Faulconer, _maybe._ And even then I seriously have my doubts. The USA (in general) is a "center-right" country. Joe Manchin is a Democrat in a VERY conservative state, West Virginia. He will never allow insanity like this to pass, if he wants to keep his job. Same for Kristin Sinema. Democrats have such a slim majority in the Senate, that if only ONE Dem Senator does not agree, the whole thing falls apart!

[@elisalyles1466]

So what has passed about this? Please update. I have only been watching your Chanel a couple weeks however I tried searching for an update and didn't find one. Taxable event with no cash to pay for it. Wow impoverished heirs. I questions 1031 all I can

[@clamitch1]

Does the proposal contain provision to be retroactive to 2021?

[@suzycreamcheese8888]

In his budget plan released May 28, Biden proposed making the capital gains tax changes retroactive to April 2021 in order to prevent wealthy taxpayers from quickly selling off assets to avoid the increase.

[@pkicng210]

Let's say that the proposal passes. Let's say there is a meltdown like in 2008. The appraised value of the real estate, say, 1 million but before the estate closes ( I think this would mean, the estate, 706 would be due and payable, the appraised value 500,000. What happens.

[@priestesslucy3299]

Wait I thought the Step-up Basis got smashed out of the bill...

[@coloradoblue262rodeo3]

basically at this point it is not in the bill, but it lots can change. Rabalais' video doesn't even talk about recent events, which is why his video is super confusing and controversial

[@geoseward]

So am I missing something but wouldn't there be a land office business in establishing a revocable trust versus testamentary will or wouldn't those with testamentary wills simply have a revocable trust established?

[@lizardwrangle]

If this passes, middle-class parents will start adding their children on their house deed.

[@chrischamberlain7628]

That’s not a good idea. Some children would throw their parents out.

[@dr.suezettealoysiaandcarla1664]

“In any contest between power and patience, bet in patience” -William Prescott “Walking distance to the Riverwalk “ -Dr CARL 🐎 Dr Suez 🌿

[@kayakutah]

How about if you leave Roth IRA assets to your kids when you die? Is that still protected from capital gains on the assets?

[@samanthacharlton4123]

Is there an updated video?! What has happened since?!

[@Crazyreseller]

How can we object to this?

[@12131bear]

Do not vote for democrats.

[@gregspeth7910]

The end !

[@avifu1316]

Wish these were available in Spanish.

[@gregspeth7910]

The federal reserve system…..

[@longngu8077]

Worse yet, this new tax law will be probably passed in December or later thru the reconciliation process that leaves no time to do anything in 2021!

[@jekutube9]

Are your maximum gift you can give every year 15K per parent? Per year. How does your 200K “gift of property” bypass this?

[@muffemod]

16K for next year

[@HydesBoats]

did the law pass? Had stepped up basis been eliminated?

[@auricgoldfinger8478]

I’m still not clear on the tax consequences of second to die and then child inheritance. There should be no tax due if less than the $11 million per parent exclusion on your example of $200000 passed at death. Are you saying the cost basis of the inheritance to the child is $10000 vs the previous stepped up basis of $200000?

[@rel53]

Any update on this? did the the law pass?

[@jaycoffsky8979]

much confusion on if taxes are due on inheritance on appreicated stocks within the inheritance exclusion. You seem to indicate that appreciated stock considered sale for fair market value even the value is within the allowable exclusion --are you saying that stock that is appreciated will have taxes due to heirs even under the deceased exclusion or taxes due on the appreciated asessts higher then the exclusion.

[@PrettyGoodLookin]

He's saying that....Homes that have appreciated since OB purchase, that are given to someone in a Will ( inheritance ),...will be counted as a Sale and will be taxed at the appraised value. Time for War !

[@nathanbristow8194]

not related to this subject but maybe you could address this question. If you and your wife are in an accident, you die immediately and she lingers on in the hospital for a week or so before dying, does the clause in my will 'if i should predecease my wife" kick in, or are you considered to die at the same time? Thanks for doing these videos they are most thought provoking. Nate

[@geniferteal4178]

Am I right that 1 mill. Exemption covers houses

[@Corkfish1]

Yes. A house would be covered, but it looks like the Democrats have backed away from these proposals for now.

[@DLewis-pc2op]

Life Insurance can help..............

[@redneck4528]

Yup, everyone forgets that loophole

[@gbinman]

My home is paid for. Would a reverse amortization loan skirt these changes since lender would own the property?

[@pinnednomadicfanatic2547]

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[@pinnednomadicfanatic2547]

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[@pinnednomadicfanatic2547]

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[@joecabezas7721]

What if Dad owed a mortgage on the property gifted?

[@earlscheib7754]

This administration is a joke

[@je9833]

So in this example, the son will have to pay taxes on the property he inherited????? 😮

[@matthewcasady6276]

Any value over $1,000,000 would be.

[@d6c10k4]

In the case of inherited property, would it be the beneficiary or the estate that pays the tax? If the estate is responsible, and there's not enough to cover the tax, what happens?

[@jnbond]

@@d6c10k4 exactly my question too!

[@DavidDiaz-jt2km]

Will the person receiving the gift have to pay taxes on the gift?

[@johnstibal2131]

The sick thing is that NONE of the these new tax proposals will even dent the trajectory the Government is on financially. The government is taking more, only to spend Much Much more and will continue creating massive amounts of debt. On a comical note, I wonder how long it will take wealthy individuals to realize that by Not Dying, they are actually saving money! LOL.

[@mscolli3]

The Boston Tea Party was over A LOT less.

[@christopherlee5650]

i went online and i found that everything is very different your comments.

[@brightonmusic]

Is there a step up basis for Ibonds?