People Lining Up To Beat the 10,000 Dollar Property Tax Deduction Limit.

originally posted by: carewemust

originally posted by: Allaroundyou
a reply to: carewemust
Well now you should know that all left winging media is going to grab at all branches they can just the same as the right media. I did not see that segment but I shall YouTube it though. Why are property taxes so high up there? Seems about $8.500 higher than the south or here in Nevada.


:edit: I pay about $2.500 is property taxes actually. Though I have a few things going on that take that down ALOT, lucky me I guess

I was wondering why so much media focus is on New York state, when it ranks #11 (high-to-low) of the 50 states. The property taxes are higher here in Illinois, according to the map at:
taxfoundation.org...

Those are just mean (average) amounts. It doesn't really tell you anything at the state level. You have to look at the county level and where the income is concentrated. Also, you have to consider property values as well. Downstate IL may have 2% property taxes, but homes aren't that expensive. However, a 1.5% property tax in a suburban area of NYC with $1.5 million homes is the norm is a much bigger expense. NYC, NJ, CT, and other areas have some very wealthy suburban enclaves with exorbitant property taxes and home prices.

a reply to: AugustusMasonicus

Wrong it's always worth that. It's not a liquid asset but it is still an asset and counts as wealth. Hell the majority of my insubstantial wealth is in my home.

Jaden

a reply to: Masterjaden

You can't use your house as legal tender unless you collateralize it, like he said.

While you may carry its value on your balance sheet as an asset, it is not cash and cannot be used as cash.

originally posted by: Masterjaden
Wrong it's always worth that. It's not a liquid asset but it is still an asset and counts as wealth. Hell the majority of my insubstantial wealth is in my home.

Jaden

If you're listing your residence as an asset you're doing it wrong.

I just watched this on the news last night.

The official at the end of the segment made it sound like a viral rule.

That you should check directly with the irs.

It does pump early revenue into the state though.

originally posted by: carewemust

originally posted by: UKTruth
Wouldn't this be a report totally in support of the tax plan - from a liberal (media) perspective? If someone is paying $10k a year in property taxes, then are they not the most wealthy in the society that will have to pay more in 2018, offsetting tax decreases for the middle class?

Another reason why I started this thread is because the people interviewed and shown in the ABC News segment didn't "look" like more well-off members of society. Just average Joe/Jane Smiths.

People in high cost of living areas don't always because it costs so much to live in those areas.

originally posted by: AugustusMasonicus
a reply to: UKTruth


Your home, if it is unencumbered, is only worth something if you collateralize it for investment purposes or sell it. You could be residing in a $1,000,000 home but it is only worth that when someone gives you the money for it.

Assets count towards wealth, liquid or not.

a reply to: UKTruth

Which is why a wealth tax is such a bad idea. You can own assets that will make you technically "wealthy" but still live on a fixed income.

originally posted by: UKTruth

originally posted by: AugustusMasonicus
a reply to: UKTruth


Your home, if it is unencumbered, is only worth something if you collateralize it for investment purposes or sell it. You could be residing in a $1,000,000 home but it is only worth that when someone gives you the money for it.

Assets count towards wealth, liquid or not.

Not all assets are liquid and thus don't necessarily mean you can use as income easily. You can still be broke income wise, but sitting on enough assets to make you a millionaire but only if you sell which may not be feasible. For example, you can have a run down house in Palo Alto, CA for worth $1 million with no mortgage. However, you may only be making say $50k/yr in income. Technically, you are a millionaire but you still need to live in your home and thus until you sell, you can only live like someone making $50k.

There is a world of difference between someone who has $1 million in cash and someone whose home is worth $1 million even though technically, both may be millionaires. This is why some studies exclude home equity when doing analyses on wealth because home equity is not very liquid.

originally posted by: UKTruth

originally posted by: AugustusMasonicus
a reply to: UKTruth


Your home, if it is unencumbered, is only worth something if you collateralize it for investment purposes or sell it. You could be residing in a $1,000,000 home but it is only worth that when someone gives you the money for it.

Assets count towards wealth, liquid or not.

Which is why i've known millionaires who couldn't pay their bills...without liquidity, the wealth means nothing when you need to transact a payment.

You can't spend your house at the grocer.

originally posted by: UKTruth
Assets count towards wealth, liquid or not.

Then you're doing it wrong:

Recently, I wrote an article outlining a few common retirement mistakes, one of which sparked some serious discussion.

Here’s what I said about the mistake of including your house in your net worth:

"You’re including your house in your assets. I often hear people describing their net worth in a conversation like this: 'I have a $200,000 house, and $800,000 in investments, so I have a net worth of a million dollars.' The problem with this description is that your house cannot independently generate income except in a reverse mortgage, which has its own twists. Basically, owning a home free and clear eliminates the need for you to have a housing expense—save, of course, for property taxes, insurance, and home maintenance costs. If you were to sell your house, then you’d need to use the money that you generated to create a stream of income to pay for your subsequent living arrangements, whether that’s buying another house, renting one, or moving into assisted living." Source

And if you don't like that source I can pull financial advisor after financial advisor that says the same thing.

originally posted by: bigfatfurrytexan
Which is why i've known millionaires who couldn't pay their bills...without liquidity, the wealth means nothing when you need to transact a payment.

You can't spend your house at the grocer.

Exactly. And if you sell your home for its 'wealth' than where do you live?

originally posted by: AugustusMasonicus

originally posted by: UKTruth
Assets count towards wealth, liquid or not.

Then you're doing it wrong:

Recently, I wrote an article outlining a few common retirement mistakes, one of which sparked some serious discussion.

Here’s what I said about the mistake of including your house in your net worth:

"You’re including your house in your assets. I often hear people describing their net worth in a conversation like this: 'I have a $200,000 house, and $800,000 in investments, so I have a net worth of a million dollars.' The problem with this description is that your house cannot independently generate income except in a reverse mortgage, which has its own twists. Basically, owning a home free and clear eliminates the need for you to have a housing expense—save, of course, for property taxes, insurance, and home maintenance costs. If you were to sell your house, then you’d need to use the money that you generated to create a stream of income to pay for your subsequent living arrangements, whether that’s buying another house, renting one, or moving into assisted living." Source

And if you don't like that source I can pull financial advisor after financial advisor that says the same thing.

A reverse mortgage is essentially selling the house to the bank and you get to continue to live in it. It is the only way to truly get the equity out of the house as a retiree and not give up the home.

originally posted by: AugustusMasonicus

originally posted by: bigfatfurrytexan
Which is why i've known millionaires who couldn't pay their bills...without liquidity, the wealth means nothing when you need to transact a payment.

You can't spend your house at the grocer.

Exactly. And if you sell your home for its 'wealth' than where do you live?

In a van down by the river

originally posted by: Edumakated
A reverse mortgage is essentially selling the house to the bank and you get to continue to live in it. It is the only way to truly get the equity out of the house as a retiree and not give up the home.

True. I didn't want to bring that up as it's not really, in my opinion, a form of investing.

originally posted by: bigfatfurrytexan
In a van down by the river

That pretty much sums it up.

originally posted by: AugustusMasonicus

originally posted by: carewemust
Are there really that many people who pay more than $10,000 a year in property taxes?

Yeah, and I'm one of them.

Holy shat! Do you live in a giant palace or is that just NJ tax rate? Why do you still live there?! My county in Maryland the property tax rate is 0.85 %

originally posted by: FauxMulder
Holy shat! Do you live in a giant palace or is that just NJ tax rate?

My house is nice but if it were in say, Tennessee or North Carolina, my taxes would be $3-4,000 tops, instead of a new Honda every year.

a reply to: AugustusMasonicus

You should move. Along with what seems like ridiculously high taxes, NJ has the worst drivers in the country. Unless you are one of them, then you stay your a$$ up there.

originally posted by: AugustusMasonicus

originally posted by: Edumakated
A reverse mortgage is essentially selling the house to the bank and you get to continue to live in it. It is the only way to truly get the equity out of the house as a retiree and not give up the home.

True. I didn't want to bring that up as it's not really, in my opinion, a form of investing.

It is a valid consideration though for retirement planning though. Often times the best way to get real wealth in retirement for people who didn't make a ton over the course of their careers, but diligently paid off a house or live in an area with high appreciation. My grandmother used one and it was a lifesaver for her as the house represented pretty much all her wealth.

Our point still stands though, being house rich does not make one a millionaire in the conventional sense.