It’s been over a year since my husband passed on, but I’m still waiting to get the final estate probate papers. The pandemic hasn’t helped, of course, but just last week I learned that I needed to get an official appraisal of the value of our home as of May 15, 2020, when Alfred died! It seems part of determining any estate tax means knowing Alfred’s 50% share of our home at the time of his death.
I was also advised that doing this now will help vis-à-vis capital gains taxes on my estate when I go join Alfred, the rest of my family and my dogs in heaven – hopefully!
As we bought our home in 1968 when prices were a pittance of what they are today, our estate will be subject to a considerable amount of capital gains tax. Well, not wanting to give the government any more than necessary, and knowing we’ve made many home improvements, I decided to go back through our files and records to cost out all these home improvements. The first one I could readily find was in 1981 when we closed in a screen porch.
Alfred’s father was an accountant and he started to teach his son how to keep cash ledgers when just a teenager. Once he started, Alfred never stopped. He kept ledgers on every year of expenditures for 75 years! It drove me nuts when each week he’d sit down and write out every expense from groceries to hair cuts to magazine subscriptions incurred during each week. If his cash on hand didn’t match his expenditures, it was always, “Joy, what did you spend it on, I’m missing $24.00! I hated the nights he balanced his books because he was so exact it was always my fault if the books didn’t balance.
Well, today, I pulled a chunk of change away from Uncle Sam! I went back in Alfred’s files of receipts and those darn ledgers and was able to document 38 home improvement projects between 1981 and 2021 for a considerable amount of money! When I told my lawyer, she was astounded, but said those records will make a substantial difference in estate taxes.
Alfred’s ledgers also enabled me to calculate the cost of every trip we took, which, when we donated our photographic collection to the University of George Bugwood website, enabled 12 years of charitable donation deductions. Our tax accountant was always waiting for us to get an IRS audit so he could see the agent’s face when Alfred walked in with all those ledgers and asked, “which expense would you like to challenge!” It never happened, but he was all prepared!
So as much as I hated those weekly financial reckonings during more than 50 years of marriage, they did make for both merry moments and chastising when Alfred had to have “miscellaneous” items in his ledger! But oh would he rub it in now! Left to my own devices, I’d never have been able to document all these expenditures, but that little kid who kept track of 10 cent bus fares and 25 cent movies in his teen age ledgers taught me a lesson that’s going to enable a bit more money for my heirs!