> The gains from selling a house are taxable. The first $500k is tax-free if married filing jointly. The rest is taxed at a maximum rate of 20%. For nearly $4m

> The gains from selling a house are taxable. The first $500k is tax-free if married filing jointly. The rest is taxed at a maximum rate of 20%. For nearly $4m in profit, that's pretty good. There'll be cash left after selling. Pay the taxes. They've gotten a really good deal on property tax for decades, and will continue to do so in their new home (keep reading). > 6% of the sale price is split between the buying and selling realtor You don't have to accept the standard shit deal in a seller's market like Palo Alto. Negotiate. List directly on MLS. Sell off-market. There are so many possibilities. > And their tax bill would sky-rocket Prop 90 allows homeowners over age 55 to keep their original assessed value when selling and moving to a different home of equal or lesser value. [1] To me it sure sounds like your parents could sell for $4m, buy a high-end condo in Mountain View or Sunnyvale for $1.5m, and have well over $1.5m left after taxes, closing costs, and moving expenses. And continue to enjoy low property taxes on their new place. Maybe I missed something though. 1. https://en.wikipedia.org/wiki/1988_California_Proposition_90 https://en.wikipedia.org/wiki/1988_California_Proposition_90