“Keep, Rent, Gift or Sell? Second-Home Tax Creates Ripple Effects in Planning”
By Zoe Sagalow
Financial Planning recently featured Lee Korn, CPWA®, Managing Partner and Founder of Opal Wealth Advisors, in the article “Keep, Rent, Gift or Sell? Second-Home Tax Creates Ripple Effects in Planning.” The article examines New York City’s new pied-à-terre tax and the broader planning considerations it may create for owners of second homes in the city.
The new tax may prompt affected property owners to consider a range of options, including maintaining the property as-is, changing how it is used, renting it, gifting it to a family member, or selling it. As Lee explains in the article, evaluating those options requires looking beyond the additional tax expense to understand how each decision may affect other areas of a client’s financial life.
“What we’re doing is helping clients model it out and see what the financial impact is, and almost always … the financial impact is not the driving force.”
For many families, Lee notes that lifestyle and family considerations can ultimately play a larger role in the decision. A change in how a property is owned or used may also have implications for estate planning, gifting, residency, cash flow, and taxes.
That interconnectedness is why Lee describes navigating these decisions as:
“Like playing four-dimensional chess, because every decision you make has another impact.”
Lee’s perspective reflects Opal Wealth Advisors’ approach to comprehensive financial planning. When tax laws or other circumstances change, the impact may extend well beyond one area of a financial plan. Looking at how those decisions connect can help clients evaluate their options within the context of their broader financial lives and personal priorities.
The article was also syndicated by Accounting Today and American Banker.
Read the full article: Keep, Rent, Gift or Sell? Second-Home Tax Creates Ripple Effects in Planning by Zoe Sagalow.