Rural Property: The Time to Sell?

A Place in the Country

BY BILL ZIERCHER

Bill Ziercher is the founder of Select Properties Real Estate. He has been active in building, buying, selling, and managing rural real estate and income property for over 25 years. For a free consultation on marketing your rural property, you can contact Bill at 314.412.3966. and for copies of previous “A Place in the Country” Articles you can email him at ziercher59@ gmail.com.

MY SPECIAL MESSAGE TO OWNERS OF RURAL PROPERTY For everything there is a season, a time for every purpose under heaven.

ne of my favorite Bible

Overses from Ecclesiastes 3:1 and also lyrics to one of my top 100-ever list of rock songs, “Turn, Turn, Turn,” the Byrds’ 1965 hit. And for those of you who own a country place or farm, this might just be the season to sell. For any number of good reasons: age, moving away, simplifying life, settling a family trust, and more. But whether you or your family have been thinking of selling your rural property in the next month, this year, in three years or haven’t really thought much about selling, this column provides things for you to consider.

RIGHT NOW, IT IS A SELLER’S MARKET. SPRING IS HERE. IT IS NEVER TOO EARLY.

This past year has seen an increase in demand for rural properties, even more dramatic than for residential. What has fueled the demand are Covid-related lifestyle changes that have also driven through the roof sales of RVs, boats and outdoor equipment. Retirement and challenges of urban life have moved up the timeline for some who have been thinking about a place in the country. And finally, low interest rates and a strong market have also helped. What makes this market even more dramatic is the imbalance of inventory. For perspective, there just are not nearly as many rural parcels as there are suburban homes. Fortunately for rural property owners, like Will Rodgers said about buying land, “They ain’t making any more of the stuff.” And in land, bumps in appreciation stick. With "work from anywhere" options, available tele-medicine and improving broadband for rural residents, I don't anticipate any long-term reversal in demand.

When things are just coming out is a great time to knock down some grown-up brush, clean up a tractor road or mow the back field that might be overgrown. Better now, so when grasses and plants take off, the fields and edges look a lot better later than a freshly brush hogged field. Nice, mowed trails through a property almost always show better. Spring is also a great time to take pictures of your property if you are going to be listing later in the year. Did you ever hear about the best way to eat an elephant? One part at a time. It is common to see a lifetime of accumulation of too many things, especially those that you don’t use like you once did. You or your family can make it a lot easier on yourselves to start now by finding a home for those things that you will not be taking with you when you eventually sell. This takes time, and it is almost always better to get a jump and clean out the pole barn, clear the yard, or fix up the house so when it comes time to sell the property there is not that pressure to get everything done at once. If the property has a nice house, it could be a good idea to have a pre-sale inspection of it. Planning ahead to sell a property never hurts; most sellers wait too long. The property starts getting away from them, grown kids who moved away and are not available to help keep it up, or just changes in life. My net message is that even if you are just starting to think about selling, there might not be a better time to get ready than now.

STEVEN A. WEBER is Partner Director of Valuation at Property Assessment Review and PAR Residential. His team of experts has the experience, market and legal knowledge to achieve the biggest tax reduction possible on residential and commercial properties. He has been reducing property taxes for 30 years, and before that was a Senior Appraiser for St. Louis County for five years. Property Assessment Review is the leading property tax consulting firm in St. Louis, saving over $100 million for some of the region’s largest commercial taxpayers – the St. Louis Galleria, Solon Gershman, Duke Realty, Mills Properties and US Bank. In 2008, PAR created PAR Residential to represent home owners in St. Louis County. PAR’s residential clients have saved over $10,000,000 in real estate taxes since 2009 with over 80% of appeals resulting in tax savings.

How to Lower Your Property Taxes

ARE THEY STILL TAX DEDUCTIBLE?

t. Louis County

Sproperties are to be reassessed in 2021 by the Assessor’s office. This new value estimate will be used to determine your property taxes for 2021 and 2022. In general, we expect assessments to increase substantially as a result of recent real estate market activity, but even if your value doesn’t change substantially, these new values should be reviewed carefully. This appraised value is supposed to represent the market value of your home as of January 1, 2021. In addition, new federal income tax rules include a $10,000 cap on the amount taxpayers can deduct in combined property tax and local and state income tax while nearly doubling standard deductions. This means many people who have historically itemized to deduct things like property taxes or mortgage interest may get more by claiming the standard deduction. These changes make taking steps to minimize your property tax bill even more important than in the past.

APPEALS MUST BE FILED IN JULY, DON’T WAIT UNTIL YOU GET YOUR TAX BILL IN NOVEMBER.

The simple fact is – assessors make mistakes. They utilize computer based mass appraisal techniques, market averages and neighborhood models to determine property values, which may not accurately reflect your property value. These errors and miscalculations end up costing you money year after year. More often than not, we find that the assessor’s value does not reflect the actual value based on recent sale prices of homes that are comparable with yours. In fact, since 2009 we have filed over 19,000 appeals in St. Louis County alone resulting in over $10,000,000 in tax savings to homeowners.

A NO-RISK RESOURCE FOR HOMEOWNERS.

You now have the opportunity to have your appraised value professionally reviewed to determine if you are being fairly assessed and taxed. We base our opinion of market value not on mass computer modeling like the Assessor does but on real comparable sales in your neighborhood. PAR Residential does all the work and only earns a fee if we are successful in lowering your taxes. All costs of the appeal are paid by PAR Residential including legal fees and appraisal costs.

HERE’S HOW IT WORKS:

1. SET UP A FILE. PAR will gather information from you and County records, including the Assessor’s “appraisal”, and set up a case file on your home.

2. DETERMINATION OF FAIR VAL-

UE. PAR Residential will determine a fair appraised value for your property based on real comparable sales in your neighborhood. 3. NOTIFICATION. We will notify you of the results of our review of your appraised value. If we determine the Assessor’s appraised value is fair, no appeal will be filed. There will be no cost to you for our time and efforts.

4. FILE YOUR APPEAL BEFORE THE

JULY 12TH DEADLINE. If we determine that your property is over-valued by the assessor we will file an appeal on your behalf and provide the required information to the Board of Equalization.

5. BOARD OF EQUALIZATION

(BOE) HEARINGS. The PAR Residential Team will attend the hearing and argue your case. We will send the official BOE results to you in September and let you know if we need to continue your appeal to the State Tax Commission of Missouri. 6. FEE. Only if we are successful in achieving a reduction in your property tax bill, we share equally in the tax savings (50/50). All of our work is performance based: NO SAVINGS, NO FEE. There are no additional costs to you for any of our work. Our invoice will be sent to you in the fall, arriving about the same time you receive your reduced tax bill. Interested in signing up? The enrollment process is quick and easy. Visit our website and sign up online today! Specific questions can be answered by emailing them to info@parresidential.com or by calling PAR Residential at 314-454-0505 from 9am to 5pm Monday through Friday. You can learn more about saving money on your real estate taxes, the assessment and the appeal process by visiting www.parresidential.com.

Estate Planning and Asset Protection

THESE TIMES CALL FOR A SENSE OF URGENCY BY SHERI TUCKER, ESQ

uring Covid-19, what

Dsurprises me is the lack of urgency many people have for basic estate planning or even protecting assets. To make sure you have what you need in place, here are the basics and the foundation for estate planning, and what may be needed beyond that. A foundation in estate planning is a Last Will and Testament, and perhaps a Revocable Living Trust. The benefit of a Revocable Living Trust is that it allows a person to organize his or her assets and property in a certain way to achieve personal goals. A

revocable trust is one in which the terms can be changed at any time. The QST: If you are married, couples may consider a Qualified Spousal Trust (QST). As a joint revocable trust, the QST is a powerful estate planning tool, especially for professionals such as doctors, lawyers, financial advisors, and business owners. Don’t Settle: Still, estate planning is not a generic form or document to lock away in a safe. A variety of asset protection solutions and advanced estate planning are available for affluent families. Let’s take a look at asset protection and advanced estate planning.

ASSET PROTECTION

The goal of asset protection is to reduce a person’s financial footprint and protect assets from creditors. Wealth management is part of advanced estate planning that creates solutions for economically affluent families. Why Now: The recent crisis of debt, business closings, and unemployment during Covid-19 impacted even some of the wealthiest of families. Low interest rates, future tax changes, and a recession make this the perfect time to consider protecting family wealth.

WEALTH MANAGEMENT

What are some options? Some types of trusts for wealth management include various irrevocable trusts, such as an Irrevocable Life Insurance Trust (ILIT). Other trust solutions include Grantor Retained Annuity Trusts (GRAT), Grantor Retained Income Trusts (GRIT), or a Grantor Residence Trust. Perhaps a person needs a Domestic Asset Protection Trust (DAPT) or a Foreign Asset Protection Trust (FAPT). Sometimes people may want to leave an estate or specific gifts to charity in a Charitable Trust. Advanced planning serves different purposes for intrafamily wealth transfers. It’s important to plan wisely and avoid improperly executed transfers that could later be deemed fraudulent.

ESTATE TAX PLANNING

Wealth management, bequests, and transfers call for estate tax planning. How does citizenship status affect estate planning? First, if a person resides in the United States for 183 days or more out of the year and owns a home, he or she is subject to federal capital gains tax upon selling the home. Also, the estate tax exemption for non-U.S. citizens is only $60,000. Proper wealth management is essential for non-U.S. citizens or a spouse who is not a U.S. citizen. U. S. Citizens qualify for an $11.7 million estate tax exemption. However, due to the recession, national debt and unemployment rate, there is a current move to cut tax exemptions and increase estate tax. The tax exemption may be lowered to $5 million or even as low as $3.5 million. U.S. Citizens are subject to 40% tax on bequests or transfers over this amount. The timing for intrafamily wealth transfers is now.

BUSINESS OWNERS

Currently, the recession, low interest rates, and high national debt are causing artificially low business valuations. Holding assets solely in LLCs is not the best solution. An estate plan may include transferring ownership of the low valued business that becomes a future tax efficient transfer. A family member may consider moving underutilized wealth. What is underutilized wealth? It means more money than a person needs to live on, and is held by only one person in the family, usually a parent or grandparent. Transferring underutilized wealth may be the plan to help a younger generation business owner avoid bankruptcy during the recession.

BOTTOM LINE

Asset Protection is wealth management. The flip side of that is protecting assets to maximize government benefits—but that is another article! Seriously, it’s important to talk to an estate attorney for the right type of planning for you. You can use a range of estate planning solutions for asset protection to accommodate your family’s specific needs, provide for future generations, and protect assets from seizure by creditors.

SHERI TUCKER, ESQ. is the Founder and Owner of TUCKER LEGAL SERVICES, LLC. She received her Missouri license in 1992. Sheri worked as a contract attorney with Monsanto, and started her own firm in St. Louis. She is an experienced estate planning and elder law attorney, a member of the National Academy of Elder Law Attorneys, and WealthCounsel. Sheri is your “personal care attorney” for peace of mind in estate planning. To set up a complimentary consultation you can call or email Sheri at 314.332.0011 or info@ tuckerlegal-llc.com.