Comments on: Fix The Tax Code Friday: Property Tax

By: Investing » Fix The Tax Code Friday: Property Tax

Investing » Fix The Tax Code Friday: Property Tax — Sat, 22 Sep 2007 19:31:24 +0000

[...] Tyler Farrer wrote an interesting post today onHere’s a quick excerptIn some places, like Philadelphia, many taxpayers are concerned about what’s going to happen to property taxes. As the values of homes have increased (and in some places, such as parts of California, they’ve actually skyrocketed), … [...]

By: Kelly

Kelly — Fri, 21 Sep 2007 17:56:22 +0000

Robert-
Really interesting piece. I will link it to the front page shortly…

By: Kelly

Kelly — Fri, 21 Sep 2007 17:49:47 +0000

ATG -
You have a great point. As I was formulating this post, my mind started wandering to other taxes… It’s a difficult thing to resolve.

By: Robert D Flach

Robert D Flach — Fri, 21 Sep 2007 17:47:27 +0000

After commenting on your posting I wrote a piece on the AMT for the NATP TaxPro Journal. When it was finished it occurred to me that something I said in the piece was relative to your discussion on the inequality of property tax assessments. The inequity is not limited to real estate tax. I decided to devote today’s posting to THE WANDERING TAX PRO to this issue – check it out at:
http://wanderingtaxpro.blogspot.com/2007/09/who-said-taxes-were-fair.html.

Thanks for the inspiration.

TWTP

PS – It looks like Another Tax Geek beat me to the punch on this aspect of the issue.

By: Another Tax Geek

Another Tax Geek — Fri, 21 Sep 2007 17:13:18 +0000

Very interesting question, but I think it goes well beyond just property taxes. For better or worse, we seem to buy into the notion that a progressive tax structure is better, but in many cases it results in a large disconnect between those consume the services and those who pay for them. Not sure what the best answer is, but I’d like to see a more direct relationship between service consumption and service funding, and less income redistribution.

By: Kelly

Kelly — Fri, 21 Sep 2007 15:31:12 +0000

Miranda – I agree with you re education. I have three children and I am paying for tuition for two of them now (fortunately, one is just preschool). I don’t mind paying real estate taxes for public schools – I do wish that the “wealth” was more evenly distributed between urban and rural schools but I can’t imagine that happening in my lifetime.

Robert – You’re absolutely right about the NJ schools and the corresponding property taxes. It’s one reason folks still move out of Philly to NJ – taxes are higher but deductible and beat the heck out of private school tuition which is more expensive and not deductible!

By: Miranda

Miranda — Fri, 21 Sep 2007 15:09:55 +0000

Thought provoking post. It inspired mine this morning: http://www.yieldingwealth.com/paying-taxes-and-yielding-wealth/

I think a lot of the time what someone is willing to pay for depends on how they view priorities. I’ll be sending my son to a private elementary school. But I’m against vouchers, and I don’t mind paying the school taxes for public schools. I think education should be a high priority for our society.

On the other hand, I am annoyed that the taxes on gasoline mostly get returned to oil companies. It would be nice if they went in greater quantity to developing renewable energy sources and technology.

It’s all about priority, and what we think is important.

By: Robert D Flach

Robert D Flach — Fri, 21 Sep 2007 14:40:33 +0000

A good question.

One area that you did not mention, which substantially increases real estate taxes at least here in New Jersey (home of the highest property taxes in the nation), is the school tax.

The local Board of Education budget is financed for the most part by local property taxes. Every homeowner pays this additional tax, based on the assessed value of their home, whether or not they have now, ever did have, or ever will have school age children – of if they use the public school system or enroll their kids in private or Catholic schools. I never had, and, hopefully at this point in my life never will have, children – yet a part of my monthly rent goes to pay for the local schools.

Granted a good school system benefits all residents in the long run – but why should someone like me have to pay for a service that I have never used and will never use.

Unfortunately, while I agree with you that the cost of municipal services is certainly not allocated based on use or need, and that this is not a fair method, I do not have an alternative way of assessing real estate taxes to offer at this time.

TWTP