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Strategies & Market Trends : The Residential Real Estate Crash Index
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To: fatty who wrote (12749)8/20/2003 10:10:33 PM
From: GraceZRead Replies (3) of 306849
 
You make more money, you pay more taxes.

A person could live in a house with unrealized real estate gains and be making less money than they were when they were younger as is the case of most older retired people who have owned their houses for 50-60 years. You think it's OK to tax them out of their home just because a bunch of people come along after them and over pay for the houses around them.

Cape Cod is a style of house. Anything that looks like a Levittown type house is referred to euphemistically as a "cape cod". The house I'm referring to is in Northern NJ which has both high real estate taxes and high income taxes (from 1.4 to 6.37%) as well as sales taxes (6%).

Now let's take MA which you seem to think pays for it's services with that (un)reasonable real estate tax. It has a flat income tax rate of 5.3% and a sales tax of 5%. So someone making 35k who happens to own a home for say the last 30 years that has had the misfortune of being in an area with above average real estate inflation will not only be paying that 10-14k in real estate taxes they will also owe about $1500 in state income tax as well as around $6300 in Federal income tax (not including what they pay in SS). This leaves them around $15k to live on and if they spend any money on anything but food and medical, they'll also pay around $300 in sales taxes. This means that before all the other taxes that sneak in here and there, 57% of their income goes to pay for one tax or another. Looks like that young couple in Quincy is doing better than the old folks hanging in there with that confiscatory real estate tax.

Now your solution is for them to sell their home to get the equity and move? I guess MA wants all their retired people to move to other states so they can get people in those houses who will pay lots of real estate tax, lots of state income tax and lots of sales tax.

Now let's do the couple in Quincy. They finally get it together to buy that 500k house from the widow who throws in the towel, sells the house and buys a condo in a low tax state.

They now pay 14k in real estate tax, around 22k in Federal income tax, 10k in state and around $1200 in sales tax. That's $74,000 in taxes before all the hidden taxes. That leaves them 48k to live on, pay the mortgage, raise a family, etc. For an effective tax burden of 61%. Let's hope she doesn't have to quit her job when the kids come along.

You think this is reasonable? You think it's reasonable for someone to have to pay over half their income in taxes, old and working class or young and white collar? No wonder Ted Kennedy has been a fixture there for so long. People from MA can't seem to be able to add.

Repeat after me,
The government is not better at spending my money than I am.

They are ripping you off and you are defending them.
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