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-   -   Neighbor not paying her fair share of property tax? (https://www.early-retirement.org/forums/f28/neighbor-not-paying-her-fair-share-of-property-tax-77930.html)

NW-Bound 07-12-2015 03:41 AM

By the way, here's another interesting thing. Prop. 13 turns out to be so lucrative for long-time home owners (new home owners pay more even if they have been life-long residents), that they want to preserve this special tax privilege when they sell and move.

There are several subsequent propositions that allow home owners to transfer this low-tax privilege if they move to another part of the state. So, what is this argument about being allowed to live in the same home as you age?

See how that works? It's all about some people being more equal than others. :)

Another Reader 07-12-2015 06:03 AM

Quote:

Originally Posted by NW-Bound (Post 1613309)
The same Wikipedia article also has a long list of negative effects of Prop. 13. See:https://en.wikipedia.org/wiki/Califo...ition_13_(1978). Following is the index.
4.3 Negative effects
4.3.1 On the housing market
4.3.1.1 Sales disincentives, less individual mobility, higher housing costs
4.3.1.2 Effects on commercial property owners
4.3.2 On the state tax structure
4.3.2.1 Unequal assessments based on purchase date result in regressive taxation
4.3.3 On sales and other taxes
4.3.3.1 Other taxes created or increased
4.3.4 On cities and localities
4.3.4.1 Greater effect on coastal metropolitan areas than on rest of California
4.3.4.2 Loss of local government power to state government
4.3.4.3 Resultant planning changes, loss or degradation of services, new fees
4.3.5 On education and public services
4.3.5.1 Effect on public schools
4.3.5.2 Loss of funding for libraries, city services
About the 3rd rail, it is no different than trying to change SS, even when it is projected that the funding is running out. Once people get some benefits, it's impossible to take it away. We have just seen Greece's problem.

Did you even read that list? Most of the supposed effects are not very significant and many of the items state there is correlation, but the cause is unsure.

Do you live in California? Were you around in the 1970's to witness what was happening? Did you read all the articles in the newspaper about local governments turning a deaf ear to all the complaints and protests of these confiscatory taxes? Were you one of the 62.9 percent of those that voted that voted in favor of the initiative?

I was here, I voted in favor of Prop 13, and I didn't even own any property at the time. The message was sent, and for awhile the tax and spend crowd sobered up.

The problems in California today have nothing to do with revenue. They have to do with where the money is going. The public drunkenness is back, and the people that wrote and campaigned for Prop 13 are long dead.

pb4uski 07-12-2015 07:22 AM

Quote:

Originally Posted by NW-Bound (Post 1613306)
No, I do not have it wrong. What you just described is how the tax in your state, where ERD50 lives, and in my state works, as I described in my several posts above. The key is to control the public budget, then divide it out using the assessed home values as weighing factors. I described the same thing you just did.

What I said was wrong was the way RE tax worked in CA, prior to their Prop 13. Their old system resulted in the gummint raking in 2x the amount, if a housing bubble caused your home price to be doubly inflated. Again, this would not have happened in your state, where ERD50 lives, or in my state. .....

My bad. I misinterpreted your post
Quote:

Talk of the bad idea of basing RE taxes on market values and having it fluctuate with housing bubbles and busts ....
as saying that one's real estate taxes would go up or down as property values go up or down. That would be crazy.

pb4uski 07-12-2015 07:36 AM

Quote:

Originally Posted by Another Reader (Post 1613296)
Treasury regulations apply to the IRS, not the local tax assessor. Most states have a legislative framework, modified by case law, that the local assessors must follow.

In California, the entity that issues property tax rules, writes the manuals for the Assessors and issues interpretive letters is the State Board of Equalization. There is also an Assessors Association. Those folks and their high level managers meet regularly to discuss the changes in the laws and the rules issued by the SBE. The third parties to the discussion are the County Counsels that advise the Assessors. Not everyone does everything the same way, but the basic rules are followed by everyone.

There are rules for exemptions and the process by which eligibility is confirmed. I'm sure other states have rules and processes for their exemptions as well.

In general, the wording of the law or rule will govern the rules and processes. If the law or rule sets a standard, then you must follow that standard. You cannot require that a higher standard be met.

If the rule or law says the standard for granting an exemption is a statement of intent by the titled owner or surviving spouse to occupy the property, then that's all you can ask for. If they give you the statement, you have to accept it at face value. However, if stated or implicit in the law or rule is the uniqueness of the exemption, then you can require the owner to have only one exemption.

I concede that if the law or regulation indicates that the a statement of intent is sufficient then that would prevail, however I find it hard to believe that a law would be written that way as it would effectively make it unenforceable so there isn't much purpose to having a principal residency requirement to begin with if you can just say that you intend to return to the property you own that has the highest property tax and all other factors are ignored. But then again, you are in California and they do do some strange things out on the left coast.

The OP is in Texas and he provided the definition in post #112, as follows:

Quote:

Originally Posted by soupcxan (Post 1613101)
Then you get into what does it mean to "occupy" a house.

definitions for terms used in Tax Code Section 11.13 are: "principal residence" is the owner's primary or chief residence that the owner actually occupies on a regular basis; "temporary" refers to a limited or short absence of the owner from the residence homestead. What constitutes a 'temporary' period of absence from the residence homestead necessarily depends on the particular circumstances: the length of the home owner's absence and whether the home owner has established another principal residence and whether the owner intends to return and occupy the residence as his or her principal residence. The length of the period probably is less important than the establishment of a different principal residence and the owner's intent to return and occupy the residence as a principal residence. Op. Tex. Att'y Gen. No. JC-415

If the owner is registered to vote at a different address, driver's license, vehicle registrations, insurance, etc are at a different address and other factors that the IRS and states use in assessing residence, that those factors would likely be used in assessing "whether the home owner has established another principal residence" as stated above.

Another Reader 07-12-2015 08:02 AM

Establishing another primary residence is often determined by whether an exemption is filed for that residence. My guess is that in the absence of another exemption, nobody will question the exemption because of the intent standard.


Lots of laws are written that have easy outs. Pressuring widows and orphans is not something most legislative bodies want to do. So they stand up for "justice," but make the law unenforceable.


If you really want to know how things are done in the appraisal districts there, why don't you call a couple and ask some questions about what they do when a neighbor complains and how and when they verify principal residence.


My guess is you have never worked for a local government agency. If you know some people that do well enough to have candid conversations, ask them about how things are really done in their agencies.

NW-Bound 07-12-2015 08:15 AM

Quote:

Originally Posted by Another Reader (Post 1613324)
Do you live in California? Were you around in the 1970's to witness what was happening? Did you read all the articles in the newspaper about local governments turning a deaf ear to all the complaints and protests of these confiscatory taxes? Were you one of the 62.9 percent of those that voted that voted in favor of the initiative?
...
The problems in California today have nothing to do with revenue. They have to do with where the money is going. The public drunkenness is back, and the people that wrote and campaigned for Prop 13 are long dead.

No, I have never lived in California, though I have friends and family in the state and visited it often.

In the 70s, I was still in college and did not have much time to follow politics. As mentioned earlier, I understood how CA residents were outraged. But, but, but now that their low taxes are locked in, they vote for it to be transferable to wherever they move.

The way to fix gummint overspending is to control the problem at the source. It should not be about protecting yourself, while allowing them to gouge the "other" people. As you said it yourself, they keep finding other ways. Vote the bums out.

ERD50 07-12-2015 10:03 AM

bold mine....
Quote:

Originally Posted by daylatedollarshort (Post 1613302)
Prop 13 passed with nearly 2/3 of the vote. Many older residents can afford the area if they have a mortgage free home. Property taxes alone were driving people out of their life long homes. From Wikipedia:

"A large contributor to Proposition 13 was the sentiment that older Californians should not be priced out of their homes through high taxes. ....

Voters here do seem to think it is fair that a homeowner should not have to relocate to a new city without friends or family for support at age 80 solely because of high property taxes. ...

I like to look at root causes, that's how you fix things. The clear issue and common element here is high taxes. As a retiree, I shouldn't have any issue with my property tax increasing at the same rate as inflation, I should be prepared for that just like my other expenses. So it shouldn't drive me out of my home.

Prop 13 sounds like it does nothing to control taxes, it just changes who pays them. Not a solid solution IMO, and it seems the chickens are coming home to roost.

It also creates a group of voters (and don't seniors vote more than most other groups?) who have little incentive to push their representatives to control spending, since they can push the expense on the proverbial 'guy behind the tree'. In fact, it motivates those protected by Prop 13 to ask for more, more, more, and more.

edit/add: I see I'm pretty much echoing NW-B's response in the post before mine

-ERD50

samclem 07-12-2015 10:27 AM

Quote:

Originally Posted by NW-Bound (Post 1613374)
The way to fix gummint overspending is to control the problem at the source. It should not be about protecting yourself, while allowing them to gouge the "other" people. As you said it yourself, they keep finding other ways. Vote the bums out.

As a practical matter, it is very hard to galvanize political support to oppose government spending. The actual spending benefits somebody (who is likely to vote for it), and doesn't directly hurt anyone (usually). It's the increased taxes needed to support the spending that can galvanize political opposition--unless the taxes are directed against a minority of the voters. At that point, things spin off into a new realm as few people oppose the actual spending and there aren't enough affected voters to vote down the taxes. A broader tax base with fewer deductions and less special treatment helps prevent this.
Yes, to the degree that special policies reduce the tax burden on the over 65 set, they'll probably not oppose government spending. Hey, who wouldn't vote for the school bond or road levy if they don't have to pay for it and it might increase their property value.

Alan 07-12-2015 05:42 PM

Thanks folks, this thread has run its course.


https://m.youtube.com/watch?v=gBzJGckMYO4


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