Q: Betty wrote last week asking, “Dear Derek: My husband suddenly passed away leaving me with a number of commercial properties that we bought in 2005. I enjoy the income from these properties, but I heard that I cannot sell them because capital gain taxes may be rising to 39.6%. I am 75, what can I do?
A: Reading between the lines, Betty, I am going to assume you and your late husband made these investments because you were attempting to create a long-term income stream in retirement and utilize the depreciation and amortization tax benefits of owning real estate. If that is the case, this has probably served you well although your life has changed considerably in the past 15 years and you have different needs today. The good news is that you may be able to still enjoy all those benefits without having to be a landlord or hire a management company over those properties in Ohio. That is right you could avoid the distractions that often haunt retirees who own real estate like dealing with toilets, tenants, and tax filings.