Friday, August 31, 2007

Regressive Property Taxes Make Owning a Home Increasingly Unaffordable

State and local politicians at city hall write their bloated budgets based on the extra revenue assessments while property owners who realize they are about to be fleeced prepare their appeals. Engaging in a property tax appeal is one way to lower your tax burden, but more need to be done.

Retired taxpayers have lost their connection with the means to pay. Taxes based on a propertys estimated value is unfair and punitive. Too many taxpayers are becoming land poor in that their property value no longer is proportional to their income. Older person on a fixed incomes often have to sell their house to pay the taxes on it. Or, in other cases, sometimes feel trapped in old homes because their taxes would go up dramatically if they moved.

Property tax is a tax on capital. It should occur only on when you sell the home just like an individual stock in the stock market. One only pays taxes on the realized gain or loss for a stock when it is sold.

An annual property tax is the most regressive, destructive tax there is. It takes from rich and poor alike, irrespective of age, family status, health or income. Property values fluctuate and municipal taxes and budgets are never lowered, it seems. Rising property values have driven up taxes for all property owners. If property values decrease, does that mean taxes will go down?

Perhaps the ebb and flow gets resolved in the Wizard Of Oz but not in most US municipalities. Most governments are addicted to a tax and spend mentality and act like the characters in the Oz movie. The lion big show where the state develops its own pet private enterprise for the good of the community. The tin man no heart that ignores the plight of the average taxpayer, the elderly and retired perhaps throwing a few crumbs of tax relief their way but a deaf ear in they way of budget cuts and overall lower taxes. And lastly the straw man with no brains who over-hires and over-compensates their employees with benefits fit for kings and queens when they should be equal to Costco and Home Depot perks and employee policies.

Many homeowners who look on property as an investment, dont perceive the value of their property to be the price at which they purchased the property. They see it as the price for which they think (or hope) they could sell it for. Little do they remember the lessons from history. In the 1800s the stock market crashed and it took nearly 50-years for markets to recover. The 1929 crash took 25-years for markets and real estate values to recover.

Even the best intentioned investments can become wrong and long agonizing stretches can occur without an underlying asset regaining its former value. After the basics in Maslow's Hierarchy of Needs are met and your shelter transforms from the basics and takes on the shape of an investment, were beyond necessity and into speculation.

That brings up some interesting ethical questions. Should a basic shelter (like a trailer) not be taxed similar to milk, eggs and potatoes or is it an investment? Should speculations such as stocks and investment homes be not treated the same? If they are the same, should they not be treated tax-wise the same and taxed only on appreciation? Regressive property taxes make owning a home increasingly unaffordable.

Property Taxes, Property Tax Appeals, Home Appraisals Determine house values for purchase, sale or how to win your own property tax appeal without the cost of an appraiser or attorney.

You can triple the chances for winning your property tax appeal and also cut your prep time in half. I've been doing this for years. After countless appraisals and tax appeals I decided to make something affordable and useful for anyone deciding to appeal their taxes.