All Forum Posts by: Ben T.

 Do you mean April 2025?  Where I am, the market starts to pick up in late Aprilor early May.

 Yes, April 2025. Sorry was a typo. 

When are the tenants moving out?  I'd start by having a realtor walk through it with you and determine how much things would cost to do and what it would add to the value of the home.  Then decide what is worth doing and what isn't.  Also remember it will take time to get them done, during which the home is vacant and not on the market.

People shop with their eyes-so many don't care about stuff that is really important (plumbing, electrical, roof, etc).  Do the walls need a good cleaning or a fresh coat of paint?  Hardware (ie cabinet knobs/pulls) if they are dated are easy to replace.  Window coverings (are there blinds that are damaged or mismatched curtains).  Carpet in general can turn off some people, but is it worth replacing?  Is it stained or discoloured or showing wear?

No, paychecks. If you do it online, you will have to deal with timing of your payments and potentially have a penalty. This is why @Logan Allec was bringing up Form 2210: it allows you to mitigate the penalty based on timing of income and payments, but it is not easy to complete.

First, we have to assume that you will have a significant taxable capital gain and will NOT be using tax strategies that defer this tax, such as the already mentioned 1031 exchange. If you're not familiar with it, search Bigger Pockets, there's ton of information.

Second, the easiest thing to do is this. Look at your 2023 tax return and see how much was your total tax for 2023, line 24 of Form 1040. Let's say it was $20,000 for 2023. You take 110% of it which is $22,000.

Now, your goal is to have $22,000 withheld from your and your wife's W2s, combined. You can look at your most recent paystubs, take the YTD (year-to-date) withholdings and then prorate it for the rest of 2024. Suppose your calculation shows that you're on track to have $21,000 withheld from your paychecks in 2024.

This is $1,000 short of your goal of $22,000. Then either you or your wife, does not matter who, go to your accounting/payroll department and tell them: I need an extra $1,000 withheld from my paychecks between now and the end of the year. They will have you complete a new W4 form and then do the rest.

After that, you can forget about the underpayment penalty, Form 2210 and other complexities. You will still have to write a check to the IRS next April as you will come short of the total tax due, but without penalties.

Now, if you want to avoid having to write a check to the IRS next April, you have at least two options:
A. prepay the expected tax from your paychecks
B. implement one of the tax strategies that delay this tax
Both options require professional assistance.

There is a safe harbor for you…it’s just 110% of prior year since you’re over the $150,000 AGI.

You can also base on 90% of current year’s taxes to avoid the underpayment of estimated tax penalty.

Keep in mind you can use Form 2210 along with your return to show the IRS how much income you earned by quarter and make your estimated tax payments accordingly.