The Canadian ( Tax ) way...

[ShokWaveRider]

I would like to see the same for a RE person. Say with a $30k Annual Taxable Income. Perhaps drawing other living expenses from saved cash not subject to income Tax. Use BC a taxes are low there and RE's are more likely to be there than NS or any other high tax province. Healthcare is about $614 Per YEAR.

[Meadbh]

Quote:

Originally Posted by ShokWaveRider I would like to see the same for a RE person. Say with a $30k Annual Taxable Income. Perhaps drawing other living expenses from saved cash not subject to income Tax. Use BC a taxes are low there and RE's are more likely to be there than NS or any other high tax province. Healthcare is about $614 Per YEAR.

BC Health premiums 2016 and 2017:

Premiums - Province of British Columbia

Best site for Canadian income tax info:

http://www.taxtips.ca/marginaltaxrates.htm

[ShokWaveRider]

Quote:

Originally Posted by Meadbh BC Health premiums 2016 and 2017: Premiums - Province of British Columbia Best site for Canadian income tax info: TaxTips.ca - 2015 and 2016 Personal income tax brackets and tax rates for Canada and provinces/territories

My point entirely!

[pb4uski]

We'll miss you... safe travels.

[ShokWaveRider]

Quote:

Originally Posted by pb4uski We'll miss you... safe travels.

All Pivots on what happens with Healthcare next year or the next. Currently Very happy. Fortunately at least we have options being citizens of 3 countries. I feel very badly for those who do not.


Frankly I think it is a shame as we get older we even need to worry about it (Healthcare) I would say the stress it adds to families (Both Young & Old) does not help the situation.

[kcowan]

Quote:

Originally Posted by ShokWaveRider Healthcare is about $614 Per YEAR.

That is just the user fee. The real costs are borne by income tax. The good news is that there are no co-pays nor deductibles no matter how much income you make.

[photoguy]

Just anecdotal evidence but whenever I talk about taxes with my canadian buddies they all seem very jealous of our rates in the US. It's quite possible to make several hundred k and be around 20% federal. But everybody likes to think the grass is greener.

I know/met a few doctors who felt that tax rates were so punishing in canada that they prefer to work only 2/3 days a week.

On the other hand, for wealthy folks like on an ER forum, so much is particular to ones individual circumstance and assets. For example, my brother's property tax (toronto) is going up something like 10-15k because the tax assessor updated home values. If he were in California he wouldn't be paying any more due to prop 13. On the other hand when it comes time to sell the home, he'll probably have at least $1M in capital gains tax free above and beyond the $500k exemption in the US.

[ShokWaveRider]

Quote:

Originally Posted by photoguy Just anecdotal evidence but whenever I talk about taxes with my canadian buddies they all seem very jealous of our rates in the US. It's quite possible to make several hundred k and be around 20% federal. But everybody likes to think the grass is greener. I know/met a few doctors who felt that tax rates were so punishing in canada that they prefer to work only 2/3 days a week. On the other hand, for wealthy folks like on an ER forum, so much is particular to ones individual circumstance and assets. For example, my brother's property tax (toronto) is going up something like 10-15k because the tax assessor updated home values. If he were in California he wouldn't be paying any more due to prop 13. On the other hand when it comes time to sell the home, he'll probably have at least $1M in capital gains tax free above and beyond the $500k exemption in the US.

Agreed for the most part. However for us (Me & DW) That have saved 70-80% of our Nest egg over the last 35 years in POST tax accounts, we can somewhat control what our income is, and only withdraw suitable amounts from our pre tax reserves to maintain a lower tax level. We chose to do this in our earlier earning years while also contributing to our 401k's. OK we paid a higher tax then, but arguably being "DINK's" we could also well afford it then.

[kcowan]

Quote:

Originally Posted by photoguy Just anecdotal evidence but whenever I talk about taxes with my canadian buddies they all seem very jealous of our rates in the US. It's quite possible to make several hundred k and be around 20% federal. But everybody likes to think the grass is greener.

They also need to factor in the cost of liability insurance which is substantially higher in the US.

[Music Lover]

Quote:

Originally Posted by photoguy On the other hand, for wealthy folks like on an ER forum, so much is particular to ones individual circumstance and assets. For example, my brother's property tax (toronto) is going up something like 10-15k because the tax assessor updated home values. If he were in California he wouldn't be paying any more due to prop 13. On the other hand when it comes time to sell the home, he'll probably have at least $1M in capital gains tax free above and beyond the $500k exemption in the US.

Prop 13 sounds grossly unfair. I can't believe it exists.

[6miths]

Quote:

Originally Posted by photoguy Just anecdotal evidence but whenever I talk about taxes with my canadian buddies they all seem very jealous of our rates in the US. It's quite possible to make several hundred k and be around 20% federal. But everybody likes to think the grass is greener. I know/met a few doctors who felt that tax rates were so punishing in Canada that they prefer to work only 2/3 days a week.

Yes much of it is grass is greener. Many folks really don't have any idea what all in costs are due to the various taxes, insurances, levies, user fees and whatever involved. At the end of the day, for most, it is hard to put a monetary value on 'home'.

For MDs, what you say may have been true in the 80s when I graduated but things seem to have come full circle over the last 3 decades. Canadian MDs pay negligible amounts for malpractice insurance and have no concern about their personal assets being at risk. Incomes are not much different, practice stresses are generally much less and MDs (along with dentists and lawyers) can incorporate and pay much lower tax rates. 'Managed care' has really kicked the stuffing out of MD morale in the US since the 90s (that is by Health Insurance companies - not Obamacare). Current governments are trying to bring things back the other way but at the moment things are pretty good for professionals north of the border.

[superdave]

Quote:

Originally Posted by 6miths Yes much of it is grass is greener. Many folks really don't have any idea what all in costs are due to the various taxes, insurances, levies, user fees and whatever involved. At the end of the day, for most, it is hard to put a monetary value on 'home'. For MDs, what you say may have been true in the 80s when I graduated but things seem to have come full circle over the last 3 decades. Canadian MDs pay negligible amounts for malpractice insurance and have no concern about their personal assets being at risk. Incomes are not much different, practice stresses are generally much less and MDs (along with dentists and lawyers) can incorporate and pay much lower tax rates. 'Managed care' has really kicked the stuffing out of MD morale in the US since the 90s (that is by Health Insurance companies - not Obamacare). Current governments are trying to bring things back the other way but at the moment things are pretty good for professionals north of the border.

Interesting. I suspected as much, as Canadian doctors really don't seem to be moving to the USA anymore. As was mentioned, many doctors here just work 3 days a week. I personally know a few who retired at 55-56 or so.

[Music Lover]

Quote:

Originally Posted by superdave Interesting. I suspected as much, as Canadian doctors really don't seem to be moving to the USA anymore. As was mentioned, many doctors here just work 3 days a week. I personally know a few who retired at 55-56 or so.

My doctor is very young (graduated 2014) and only works 4 day weeks. She also takes a lot of time off...I'm not sure if this is due to tax rates or perhaps she simply has a good perspective on the work/life balance.

[Walt34]

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Originally Posted by Music Lover Prop 13 sounds grossly unfair. I can't believe it exists.

It was passed in reaction to sharply rising taxes on homes that had been bought in earlier times. In many cases people were being forced to sell their homes in order to pay the rising taxes. I doubt that anyone would call that fair either. I lived in Maryland at the time and remember seeing many newspaper articles about it.

It was passed with much anguish and gnashing of teeth not only in California but nationally, as the same issue was coming up in many places. Here's a bit of history on it: https://en.wikipedia.org/wiki/Califo...ition_13_(1978)

[pb4uski]

What I would call unfair is two neighbors with substantially the same properties that have the same fair value paying drastically different property taxes simply because one is a new owner and the other has lived there for a long time. Wacky.

[Music Lover]

Quote:

Originally Posted by Walt34 It was passed in reaction to sharply rising taxes on homes that had been bought in earlier times. In many cases people were being forced to sell their homes in order to pay the rising taxes. I doubt that anyone would call that fair either. I lived in Maryland at the time and remember seeing many newspaper articles about it. It was passed with much anguish and gnashing of teeth not only in California but nationally, as the same issue was coming up in many places. Here's a bit of history on it: https://en.wikipedia.org/wiki/Califo...ition_13_(1978)

If someone has to move because they can't afford the property taxes, that might suck and be inconvenient, but it's not unfair. Prop 13 doesn't solve a problem...it creates one.

[nuke_diver]

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Originally Posted by pb4uski What I would call unfair is two neighbors with substantially the same properties that have the same fair value paying drastically different property taxes simply because one is a new owner and the other has lived there for a long time. Wacky.

That is true if property values are not changing much but in Silicon valley property values go ballistic and taxing people who bought a long time ago based on going rates forced them out of their homes, hence Prop 13. Forcing someone to move out of the area because property values are increasing faster than their ability to pay is also pretty unfair I think. And the county is not going to go with less tax for everyone. It's hard to comprehend but it's also hard to comprehend housing values increasing 200% in the last 7 years I think for most

Note that since ~2010 prop 13 has been modified in some counties so the PT does vary more than the max 2% that was originally legislated. So in those counties only houses purchased prior to 2010 are limited to 2% increases. That might actually be even more unfair

[Walt34]

Quote:

Originally Posted by pb4uski What I would call unfair is two neighbors with substantially the same properties that have the same fair value paying drastically different property taxes simply because one is a new owner and the other has lived there for a long time. Wacky.

From that perspective you're exactly right. But look at it from the perspective of the guy who bought his home in 1965 for say, $15K and at the time his property taxes were (randomly trying to pick a reasonable number here) $150/year. Fast forward to 1977 and the property taxes are now quadrupled or more because "the market" now values his house at $60k.

And all this guy did was own the place and go to work every day and do his job. Now he can't retire and stay there and be content because someone else decided that he has to pay outlandish taxes. Wacky.

Rightly or wrongly that's what Proposition 13 was about.

[pb4uski]

Quote:

Originally Posted by Walt34 From that perspective you're exactly right. But look at it from the perspective of the guy who bought his home in 1965 for say, $15K and at the time his property taxes were (randomly trying to pick a reasonable number here) $150/year. Fast forward to 1977 and the property taxes are now quadrupled or more because "the market" now values his house at $60k. And all this guy did was own the place and go to work every day and do his job. Now he can't retire and stay there and be content because someone else decided that he has to pay outlandish taxes. Wacky. Rightly or wrongly that's what Proposition 13 was about.

Well, if his house appreciates 400%, his property tax bill will NOT increase 400% (assuming that the grand list quadruples as well). In fact, if the municipal budget stays the same, the grand list quadruples and his appraised value quadruples then his property tax bill would still be $150.

Tax rate increases occur where the budget increases and/or your property's appraised value increases faster than the grand list, typically the former.

[Meadbh]

Quote:

Originally Posted by superdave Interesting. I suspected as much, as Canadian doctors really don't seem to be moving to the USA anymore. As was mentioned, many doctors here just work 3 days a week. I personally know a few who retired at 55-56 or so.

Some of them are members of this forum, too!