DEAR BOB:I recently bought a house. The seller and/or his real estate agent took all the three sets of washers and dryers in this large house before I got the keys. I think the washers and dryers are fixtures, not to be removed by the seller or the agent. What can I do about this? –Lea W.
DEAR LEA: Any moveable appliance that is not permanently attached to the structure, such as by bolts or built-in like a dishwasher, is not a fixture and remains personal property.
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Unless the sales contract clearly said the washers and dryers were to remain in the house, the seller was entitled to remove that personal property along with the furniture.
The law of fixtures can sometimes be difficult to apply (although not in your situation). For example, I’ve seen large built-in refrigerators with panel doors that match the kitchen cabinets. As a lawyer, I could argue such a refrigerator is a built-in appliance fixture automatically included in the sales price. However, if the refrigerator easily slides out without damage to the structure, then it is arguably personal property belonging to the seller.
Experienced real estate agents make certain the sales contract specifies any personal property or questionable fixtures the buyer wants included in the sales price. Unless listed, and usually conveyed by a bill of sale, such items remain personal property, which the seller can remove. For more details, please consult a local real estate attorney.
CAN MEMBERS ATTEND HOMEOWNER ASSOCIATION MEETINGS?
DEAR BOB: About six months ago, I bought a very upscale condominium. My neighbors are the nicest people and I love associating with them. However, the condo homeowner association is considering a special assessment to re-carpet the hallways and refurbish the main entrance. Although the replacement reserves appear to be very adequate to take care of this expense, which I agree is needed on our 15-year-old building, the board of directors proposes assessing each owner $1,500 to $2,500, depending on the size of his/her condo. What irritates my neighbors and me is we are not allowed to attend the monthly board meetings. We are allowed only to write letters to the directors and attend the annual meeting. Is this legal? –Corla S.
DEAR CORLA: The best-managed homeowner associations allow any member to attend the monthly meetings of the board of directors. However, occasionally the meeting must be closed, such as to discuss personnel matters like hiring or firing an employee. Of course, if your association has a large membership, rules must be adopted to provide orderly meetings.
For many years I have owned a condo where the monthly meetings are open to the members. Few members show up, but I always read the meeting minutes sent to every member a few days later to see who was there and what happened at the meeting.
If a controversial issue arises, the board invites member comments by letter and holds the matter over for a decision at the next meeting.
At the conclusion of each monthly board meeting, after the written agenda has been completed, the board asks for any comments or suggestions from the member attendees. This prevents the meeting from getting off to a bad start or getting bogged down during the business meeting.
NO DEPRECIATION RECAPTURE UNLESS INVESTOR SELLS
DEAR BOB: I am preparing for my annual visit with my accountant to discuss my tax situation on my investment properties, which I have owned for many years. I was trying to verify at what tax rate I will be taxed for the depreciation I’ve deducted over the years. What is your perspective on this matter? Is the tax rate 15 percent or 25 percent? –Allyn P.
DEAR ALLYN: Unless you sell your investment property on which you have been deducting depreciation, there is no need to be concerned about depreciation “recapture tax.”
However, if you are selling a depreciable property you have owned since before 1997, then the situation gets a bit complicated. In 1997, Congress enacted the special 25 percent depreciation recapture tax rate on depreciation deducted after May of that year. But different rules apply to depreciation deducted before that date. However, ordinary federal capital gains are currently taxed at a maximum 15 percent tax rate.
The new Robert Bruss special report, “2007 Realty Tax Tips: Eight Chapters of Tax Savings for Homeowners and Realty Investors,” is now available for $5 from Robert Bruss, 251 Park Road, Burlingame, CA 94010, or by credit card at 1-800-736-1736 or instant Internet delivery at www.BobBruss.com. Questions for this column are welcome at either address.
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