Tuesday, January 8, 2019


Nine years after Mr. Ralph's dream come true, the financial manager convinced me I can't afford two homes.  Even with my friend living there and keeping an eye on things and paying some rent, I pay a chunk of change out of pocket.  Plus the concern when things stop working, break and need replacing.  Or she asks me a question on "how to" and I just don't remember .... she has to read the manual.

While living with my little family these past two years, I have decided I would rather live here than there.  More family here, easier to visit family, more retail, more volunteer opportunities, more seasons, better library, better Adult Center and a great foodie area.  And they convinced me that they would rather have me here, despite the close quarters.  I suggested maybe when Braeden turns 10 I could find a small apartment nearby and he could have my room.  Nope!  They think having them share a room keeps their healthy relationship growing.  Of course, I may want my own bathroom by then ... 

Luckily (I thought), Maui housing prices have gone WAY up since we purchased.  This is my retirement nest egg.  I was so excited to think about earning even 4% on the investment of net proceeds, coupled with Social Security ... I would be on Easy Street.

I contacted my friend who is the realtor who helped us buy the house.  She did a little research and WOWZA!  The price range she mentioned is even better than I was thinking.

My bubble was burst the week before Christmas when my friend/realtor gave me a draft escrow recap.  I had no clue the State of Hawaii imposes a 7.25% tax on the SELLING price of homes sold by nonresidents.  

So, now I'm trying to figure out what length of time will suffice for me to be considered a resident who would not have to pay this "withholding".  I may be moving back for a year.  It might need to be two years (from what I've read) although I do have a current Hawaii ID and have paid state taxes for two of the years.  I'm also hoping there is a one time home sale for seniors (or widows) that does not require capital gains or reinvestment.  Stay tuned.

My realtor is not too happy.  I don't blame her.  She's put in so much time and energy and dealing with a grumpy and obstinate tenant.  But for $45,000 ... I think it is in MY best interest to not pay!  She keeps telling me how I can file and get some of that money back (it is NOT a tax, she says, it's a "withholding".  I get that ... but it's a withholding of a TAX)  At least with just capital gains I can deduct the cost of the house (at the time of Mr. Ralph's death), all the improvements and be excused from the first $250,000 of gain.

Sorry for whining.  I know it is a first world problem and this will make me an upper middle class white privileged Widow.  I don't mind paying my fair share of taxes but Hawaii?  You are asking too much!


  1. Wow, who would have ever guessed but your realtor should have known the laws in the state and told you up front, after all they have to take tests to get their license. How the state defines a resident should be interesting. If you still pay taxes and have a state ID and vote there, to me that would qualify. If you have to move back for a year better to do it now than wait until you can't manage as easily. That's too much money to ignore. Good luck with your research and decision.

    1. Yes, the Realtor should know ... and should have told me up front!! But she kept saying “it’s not a tax, it’s a withholding” And it just went from 5% to 7.25% in September. Thank goodness I asked for all escrow costs ....

  2. Replies
    1. It's been an ordeal to say the least! The combination of prepping and selling, an obstinate tenant, tax consequences AND have the worst sinus infection EVER ... but HELLO! Here we are on the other side!!!