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Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: Wyätt Gwyön who wrote (13050)	8/23/2003 3:03:15 PM
From: GraceZ	Read Replies (1) \| Respond to of 306849

Understanding what you mean by the term "rentier class" isn't entirely necessary, what would be necessary though would be a way for the tax code to make a distinction between "middle-income hardworking landlord class" and what you call the "rentier class". I'm curious how you think the tax code could be written to make that distinction (as I'm sure others following along are curious as well). The tax code already makes a distinction between someone who owns and manages property as a primary source of income (active) and one who has real estate as a "passive" activity such as my husband. You can't have a hundred houses for rent and still pass that activity off as "passive". If the tax code deems your rental biz as "active" the income from such is subject to the same tax laws as any other business activity. Your suggestion that Social Security payments be made on passive income tells me that you don't really understand what it is that Social Security was designed to do. It's original intent was to act as insurance against a wage earner's loss in the ability to earn a wage and to cover the loss of a primary wage earner in a family, it is insurance against that person getting too old or disabled to hold a job. Passive income wasn't included for a really good reason, it is independent of a person's age, disability or ability to work. It's also independent of them being alive! Turn 65 and dividends don't stop and neither do rents. Dad dies and the wife still collects those dividends. Lose your sight or use of your hands and you can still collect your interest on T bonds. It wasn't necessary to insure against the loss of such income, therefore it wasn't included when factoring the premiums paid in or the benefits paid out. Someone who spent a lifetime collecting dividends wouldn't accrue any Social Security benefits, as they never would pay any Social Security premiums.