[‎‎‎‎‎‎‎‎‎USER]

I’m about to sell a vacation investment property/beach house and should see about 300k in equity. It was a property I used for a 1031 exchange 4 years ago.

I know I’ll have to pay capital gains.

I’ve never had this kind of money incoming before in a lump sum.

Where/how would you put it to protect as much as possible from taxes?

Was thinking max out retirements accts, maybe start an HSA.

Other thoughts?

[Russ]

Once you pay capital gains you won’t have to worry about any more taxes…

[Jack]

I did the same thing a few years ago (2021) with a beach house we shared with other family members.

The money went straight into my brokerage account and was invested along with my overall asset allocation.

I did put aside enough money to pay the taxes in a HYSA.

I’m so glad I don’t have to worry about managing that property anymore and the stock fund I bought (mostly VTI) has gone up 50% from there.

[Jeremy]

There’s really not much you can do to avoid capital gains taxes. Just make sure you’re properly accounting for everything.

If you’ve done any improvements to the property you should be able to add those costs to your cost basis.

Just because it’s 300K of equity doesn’t mean it’s 300K of gains.

Your actual capital gains are likely lower.

[Angelo]

There’s no avoiding taxes. Maybe you can offset some by maxing out your 401k with income from employment.

An HSA is good too but you’d need to have a health insurance plan that allows for an HSA.

Do you have any investments that you can sell at a loss?

Capital losses will offset capital gains.

[Author]

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