MetLife's announcement this week that they are now offering structured installment sales in California, Florida, New Jersey and Texas is welcome news to those of us who practice in this field. It's even more welcome news for anyone seeking to defer or eliminate capital gains.
MetLife, one of the largest life insurance companies in the United States, joins Independent Life and Midwest Trust (which offers a U.S. Treasury-backed structured sale option) in meeting this growing need.
The timing of this roll out is near perfect since we're now one year into the Tax Cuts and Jobs Act which substantially lowered the threshold for triggering a 20% (Federal) capital gains tax.
Not only can sellers potentially move from a 20% bracket to 15% or lower, they may be able to avoid the 3.8% net investment income tax (NIIT) as well. Not to mention potential savings on state capital gains taxes.
I recently helped a client pay
ZERO capital gains taxes
on an appreciated piece of property he sold
Not every appreciated asset will qualify for installment sale tax treatment and not everyone will be able to eliminate capital gains taxes altogether. But if you can save tens of thousands of dollars or more depending on the size of your transaction just by deferring your gains, isn't it worth a look?
Tax laws and tax brackets are always subject to change, so clients are urged to seek independent tax counsel before making any decisions. While we can't give tax advice, we can definitely point your CPA or tax attorney to the proper sections of the tax code so they can help you make the right decision.
So, before you sell your rental property, primary residence, inherited property, land, business, law firm, insurance agency, dental practice, Lichtenstein sculpture, or other qualifying asset, let us see how we may be able to help you save money.
Because the buyer's cooperation is necessary,
sellers must plan to structure BEFORE finalizing any sales contract.
We have all the required paperwork,
but a decision must be made in advance of finalizing.