Posted on 09/11/2006 5:46:01 AM PDT by Rb ver. 2.0
LAKE LURE (AP) — Donald P. Cook, who won HGTV's 5,700-square-foot Dream Home on April 29, plans to sell the house because of the high taxes and maintenance costs.
Cook, an auditor for the state of West Virginia who has been disabled since childhood by multiple sclerosis, said the electricity bill is more than 10 times what he now pays.
"I don't think there's any possibility I could afford to live there," Cook, of Alum Creek, W.Va., said in an interview posted on the Home & Garden Web site. "What we plan to do is live in the Dream Home for about three weeks, then sell it."
The home overlooks Lake Lure in Rutherford County and has been assessed at slightly more than $3 million with an annual tax bill of $19,396.64.
Cook, who was one of 40 million people who entered the Dream Home contest, plans to retire in October and stay in West Virginia. He said he'll use the money from the Dream Home's sale to buy another house.
"It's a dream that anyone would love to have — owning a house like the Dream Home," he told HGTV. "But then reality sets in."
A lot of people would go down the tubes trying to hang on to it.
It comes with all the decor, which is valued at top-market. I hope he manages to sell it and make a little after taxes.
If he doesn't hold on to it for two years (I think that's how long to qualify for lower capital gains taxes) he's going to pay through the nose in income taxes too. He'll pay far more in increased income taxes than it would cost to keep it for two years - and live there at the same time.
Get a loan against to cover the two years.
My wife and I both entered to win that house and watched the show. But we both knew we would be calling the local realitors within 15 minutes of teh tv crews leaving. Take the cash.
That is the reason I never enter a contest for a new home or “A Brand New CAR!”. I could not afford the taxes and insurance.
Why didn't HGTV offer a dream home a likely winner could afford to live in?
He's lucky with such cheap taxes. In comparison, mine are at a much higher rate. Still, it's a win-win for him.
"I hope he manages to sell it and make a little after taxes."
If he lives in it only three weeks and then puts it on the market, he has an almost iron-clad case that the selling price is the basis for taxible income from the prize.
If so, whatever price he sells it at, he gets to keep at least 60% of the profit (depending upon whether there are WV income taxes, and whether the IRS insists that the gain from selling the place is really "income" and therefore subject to Social Security). That should leave him enough to pay for a 3-2-2 in a nice subdivision free and clear.
He needs to open a Bed & Breakfast operation
I knew that would happen. I saw this back when they first advertised it and said if I won I'd have to sell it because I couldn't afford the taxes...........
Anyone with sense would know that it costs a fortune to maintain a huge house and pay taxes on it. You just have a good weekend in the house and list it with a high power realtor on Monday. Buy a decent house and maybe a car a few years newer with the sale and consider yourself blessed.
>>If he lives in it only three weeks and then puts it on the market, he has an almost iron-clad case that the selling price is the basis for taxible income from the prize.
Beat me to it. My wife, the very-accomplished CPA, would probably leave out the "almost".
Advertisers contribute their goods and wares to the construction, in order to get to say, "Our __________ was selected to be in the HGTV Dream Home."..........
Didn't he already owe for a capital gain when he won it? How are winnings such as this taxed, as regular income or as a capital gain?
By virtue of the fact that he won it, he will still owe taxes on it whether he sells it or not. You have to be careful with these things. There was a case down in Florida a few years back where someone who won a boat in a radio station contest decided to take it for a spin before selling it to pay the taxes. They got a lot less for it than it was valued. The IRS declared that, since they took a ride in it, they got it new and sold it used and therefore owed taxes on the inflated value that the radio station used in their promotions. They wound up digging into their pockets to pay.
Welcome to your new Dream Double Wide!
B&B? Wouldn't cover the taxes, probably. A brothel on the other hand..........
http://www.hgtv.com/hgtv/gl_design_plans_strategy/article/0,1785,HGTV_3569_4357788,00.html
..anyone who thought the average person would be able to live there must be a liberal
Doogle
Couldn't afford to live there because of taxes?
HGTV giveth, and the government taketh away.
You might be a redneck if your "Dream Home" includes a tongue and a set of wheels..........
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