DEAR BOB: My daughter and I own a house as joint tenants. She has lived in the house for the last two years. I have never lived there. We plan to sell it and expect a net profit around $100,000. Can the entire profit be allocated to her so it will be exempt from capital gains tax? –Arnie C.
DEAR ARNIE: Yes. If your daughter owned and occupied her principal residence at least 24 of the 60 months before its sale, Internal Revenue Code 121 entitles her to claim up to $250,000 tax-free home-sale profits. Thankfully, this includes the entire $100,000 expected sale profit so no capital gains tax will be due on the sale. For more details, please consult your tax adviser.
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IS HOMEOWNER RESPONSIBLE FOR TRIMMING OVERHANGING TREES?
DEAR BOB: I have renters living in the houses on each side of my house. These rented houses have trees that overhang my property. Is the owner responsible for trimming these trees? If not, can I trim these overhanging trees? –Jim H.
DEAR JIM: A property owner can trim overhanging trees back to the property boundary. However, be sure your trimming is not so severe that it kills a tree or causes it to fall and cause damage, in which case you could be held liable for the loss.
Before trimming the overhanging trees, try to contact the adjacent owners on a friendly basis. I recently did that about two trees that leaned toward my house.
My nice neighbor paid to have his trees removed to avoid future possible damage liability if they fell and damaged my house.
WHAT IF LISTING AGENT REFUSES TO RAISE THE SALES COMMISSION?
DEAR BOB: Thanks for those recent items about raising the home sales commission to 7 percent — with 4 percent going to the buyer’s agent — to get a house sold in a slow market. That is exactly my problem. However, when I showed your article to my listing agent, her broker said it would be “unethical” to charge a 7 percent sales commission so he refused. My listing still has about 60 days left and I want the house sold. What should I do? –Pat C.
DEAR PAT: I am shocked. I’ve never heard of a real estate broker refusing to raise the sales commission to get a listing sold.
There is nothing unethical, illegal, immoral or even fattening for a home seller offering to pay a 7 percent sales commission with 4 percent going to the buyer’s agent and 3 percent to the listing agent.
If I were in your situation, I would phone the listing agent’s broker, politely explain you want to get your house sold in a slow market, and wish to raise the sales commission to increase the incentive for buyer’s agents to sell your house. If refuses to agree, then it’s time to consider canceling the listing for lack of due diligence so you can list with a better agent.
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