From 24/7 Wall St. · David Beren · · 1m
Retirees Stay Put and Outperform
Retirees who stay in their homes beat movers on taxes and costs.
In brief
Retirees who stay in their homes beat movers on taxes and costs. Long-term homeowners avoid IRS taxes and outperform relocators by keeping their homes. Originally reported by 24/7 Wall St..
Retirement Strategy
Staying in a long-held home shelters hundreds of thousands of dollars from IRS taxes.
Most Retirement Plans Focus on Moving
Most retirement coverage focuses on low-tax states, cheaper coasts, and condos near grandkids.
Costs of Staying Put
A 67-year-old couple with a mortgage-free home faces $75,170 annual costs including taxes and medical.
Tax Advantage of Long-Term Ownership
Long-time homeowners sit on gains the tax code only partially shelters, up to $500,000.
Embedded Tax Gains
A couple who paid $150,000 for a house now worth $900,000 owes $37,500 in taxes on $250,000 gain.
Medicare Impact
The gain pushes couples into higher Medicare Part B costs, adding $4,870 annually.
What It Takes to Outperform
A paid-off home, $75,000 budget, and $875,000 portfolio support 3.5% to 4% withdrawals.
What it means
Long-term homeowners avoid IRS taxes and outperform relocators by keeping their homes.
