Suggestions

:speech_balloon:

Tie Location to an Asset (for tax calculations)

My PL account is configured with my location as MN, but in my plan I model out relocating to TN when my ‘Move into Sr Living’ milestone hits…and then have my ‘Sell Home’ milestone triggers 1yr after that move.

PL should have a Location tied to the asset, separate from the Location associated to Me & Spouse. This would allow for PL to know the purchase/sales taxes for that asset location. Ex: MN home under MN house sale tax rules even though Me/Spouse resided in TN.

Same theory for setting up a reoccurring asset purchase (like car every 7yrs)…PL might need to take into consideration that the location the asset was purchased (MN), understand that during this ownership window Me/Spouse relocated to TN, and thus know the correct state for taxes on the next reoccurring sale/purchase.

For more mobile assets (like car, boat, jewelry, etc.) maybe assumed that the Location of Me/Spouse is appropriate for purchase/sale tax calculations, but for the non-mobile assets (like house, land, rental property, etc.) ask for the location of that asset.

1 vote

Tagged as Suggestion

Suggested 01 October by user Mike Bendtsen

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  • 01 October Mike Bendtsen suggested this task

  • avatar
    Shawn Sansom

    Doing this would require also knowing every state’s non-resident tax rules. :)

    AFAIK most states tax capital gains from properties sold in other states. If they have tax at all.

    And states with capital gains tax non-residents when they sell, but this where things get nitpicky.

    Lastly, the state of residence will typically give a credit for taxes paid in another state. So if your destination state is higher tax than your departing state then the current implementation probably already works. If your destination state has lower tax, then you’d need to owe yourself a Tax Credit to offset the costs.

    I’ll approve this, but I think it’s important to note the high complexity vs. low cost of manually approximating the tax on the sale.

    03 October

  • 03 October Shawn Sansom approved this task

  • avatar
    Mike Bendtsen

    Agreed....this one could be tricky, and gets even deeper into the tax laws then PL does now.

    I might be making an assumption that for an asset (like House), PL is using Location for tax estimations on the sale. That is where this suggestion came from…

    My plan has me moving to a new home in another state before the current home has been sold (sell home 1yr after move). As such, was wondering how PL handled the taxes.

    With all the complexity of the tax-math, having the user enter in an ‘estimated tax’ variable might be best approach vs. lots of engineering & maintenance complexity for the value.

    Maybe the real suggestion, with Location now becoming a first-class variable (in v4.4.0), is that the PL team might consider releasing an updated YouTube Video talking about what that (Location) means and how PL uses it…?? Help bust/validate any assumptions being made…

    06 October