Jan 28, 2021
Pres. Biden has floated the idea of getting rid of something called "stepped-up basis". What is this and how does this affect you?
When your parents pass and leave you the family house (or any asset), for instance, normally you would inherit that property at what it is worth today, regardless of the cost that your parents acquired it.
So, for instance, if your parents purchased their home for $40,000.00 thirty years ago (the "basis"), and if, at their death (the last parent to die) the house is worth $200,000, and then, after inheriting it, you were to sell that house today (for, say, $205,000), you would only pay taxes on the gain from what it is worth at the time your last surviving parent died and what it sells for (gain=$5,000.00 in this example - see outline below). This is because the "stepped-up basis" automatically increases the "basis" from the original purchase price ($40,000.00) to what it is valued at upon the last owner to die ($200,000.00).
If Biden does away with a "stepped-up basis," a policy/law that has been in place for many, many decades, you will inherit the property at the value your parents paid for the property (this is called the "basis" - $40,000.00). If you decide to sell (at $205,000.00) you will pay taxes on the difference between the original purchase price (the "basis" = $40,000.00) and what it sells for today ($205,000.00 = taxable value: $165,000.00). If you choose to try to keep the property, the IRS could still determine a value as of the date of the last to die and tax you on the gain (depending upon how the law and IRS regulation might be effected by such legislation).
Here is what this looks like:
Current Policy with a step-ups in basis:
- House original purchase price: $40,000
- Inherited House at Current Value - $200,000
- Sells for $205,000
- Taxable income = $5000
- Taxes Due - 20% of $5000 = $1000
- Profit to you = $204,000
Biden proposed Policy:
- Inherited House at original purchase price - $40,000
- Sells for $205,000
- Taxable income = $165,000
- Taxes Due - 20% of $165,000 = $33,000
- Profit to you = $172,000
If your parent were to have sold this property prior to passing they would have paid no taxes because it was their primary residence. This will be, if Biden goes forward with this plan, a massively huge tax on the middle and lower classes, as well as forcing people to incur additional cost and time expenditures attempting to determine the original purchase price of the asset (houses are easier to track down this information than, say, stocks).
Paul A. Ledford, Esq.
Ledford & Associates
Jan 22, 2021
In April 2020, inside a local, Ottawa County, MI sandwich shop, my client expressed his opinion regarding the Governor's COVID orders .... and was charged with "disturbing the peace," a misdemeanor under MCL 750.170. We moved to dismiss the charge on 1st Amendment grounds arguing that the statute was unconstitutionally applied against my client in a manner that unconstitutionally punished his 1st Amendment rights of free speech and expression in a public place.
In its opinion regarding our motion to dismiss, the Court denied our motion, but limited the prosecution to only presenting evidence of his "threatening" conduct (of which the State's witness had already testified in an evidentiary hearing Mr. Steffes did not threaten her).
The prosecution continued its case against my client despite the court's opinion and order.
We then moved to limit the prosecution from using any expressive, non-violent words during trial, arguing, again, that any testimony discussing his non-violent expressive conduct necessarily required testimony about what he was communicating by means of his expressive conduct. This was based upon the Court's prior order and the testimony of the State's witness that she had not been threatened by Mr. Steffes (she did testify that she felt threatened by the content of his speech, but the Court ordered that this was protected speech and could not be used against him in the prosecution's case).
Today we were back in Court to argue the motion. Prior to the commencement of arguments, the Prosecution admitted that due to the Court's order it "could not proceed" and therefore dismissed the case.
This is a HUGE win for proponents of First Amendment civil rights, but, once again, the "forgotten man" suffers under the financial strain of protecting that interest. We are asking once again (and thanking you in advance) for any assistance to help cover his attorney fee costs.
To donate and help, go to this GoFundMe page
Jan 20, 2021
Michigan still makes it nearly impossible to access some public information.
Read more at The Detroit News
Jan 13, 2021
There's a lot going on in just a few sentences, and it's important to know when and how it applies to common situations -- and, equally as important, when it doesn't
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Online casino sites will launch soon. The 15 provisional licenses issued in early December indicate that several companies are preparing to virtually open their online casinos.
Read more at Legal US Poker Sites