When should you have to pay property taxes?

[YourTokah]

My grandmother is 83 years old. She has lived in the same house for over sixty years. She and her husband bought it, built it up, and paid it off. Now she has to continue to pay a property tax every year well over a thousand dollars. She is too old to work and in poor health. In the past several years, she's been threatened by the government that she will be out on the street if she can't pay her property taxes - the whole family has tried to pull together to pay them each year, but none of us are exactly rich, either, and we have our own taxes to pay. At what point should she have to stop paying taxes? I say when you own your home free and clear and/or when you are old enough to draw social security benefits, or you draw disability benefits because your are permanently disabled, you shouldn't have to pay property taxes.

[Prometheus]

You never own your home "free and clear". Not only can the government condemn your land (even for a private buisiness now), but you essentially "rent" the land from them with property taxes. Since we live in a society where the government built sewage, roads, electrical and water lines, the gov needs money to build those (I don;t think the gov should be doing that, but that's another discussion). Currently those funds are raised through property taxes. Of course those taxes are also used for other things like parks and schools, which everyone in the area dosen't use. I don't think property tax should be used for things like that.

[YourTokah]

So are you saying that she Should have to pay her property taxes because she uses the roads? And if she can't, then what? She's s.o.l.?

[Prometheus]

I never said I liked the idea, that's just how it is right now. The gov is in the road business, so if they are going to take care of the roads they have to get the cash somewhere. I would be in support of building roads with a gasoline and automobile tax (but yet again that's another discussion). My guess is that what is jacking up your grandma's taxes is a school being built. (That's the most common cause of property tax hikes). That or a new sewage treatment center.

[SteveA]

To me property taxes seem a step away from communism.

Under communism you don't truly own anything but instead everyones resources are pooled and divided up and redistributed to everyone (after government takes it cut).

WIth property taxes, you effectively are paying rent to keep something you may have even built yourself. There is always a danger of having financial problems (often due to health or age related problems as you indicated) and having your property taken by people who never even owned it.

The reason why I see it very similar to communism is that if you consider how the tax works, they take a percent of your property every year and redistribute it (or even just blow the money and claim a deficit), the more you have, the more you pay, the less you have, the less you pay. Ultimately, if the money were purely redistributed, everyone would own the same value of property. (Value is a subjective term but that's inevitable, people view value in different ways).

But an even clearer way to put it is that you're being forced to pay rent for something you should own. If you're effectively being required to pay rent, then who ultimately owns it?

It's also a bad idea economically as well. You discourage people from creating property value and reward them for not doing it, or dare I say, even destroying property value. If we have housing problems with high prices you can blame a lot of these on construction unions, building codes, property taxes, emminent domain (almost half the land in the U.S. is now owned by government, so no wonder we see more scarcity) etc. I even want to say the public education system but that hits so many areas of the economy that it's redundant to say it.

Imagine if the government came for an annual assessment of your computer and took a percent of it everytime? If that's capitalism, free markets and private ownership then I've been confused about the concepts for a long time. If we aren't yet a socialistic empire, give it a few more decades (and then we wonder why foreign countries complain about our involvements abroad - I bet it's the same dang complaints we have at home).

Here's an aritcle about almost the same thing - a daughter built a place to stay for her 95 year old mother but something got messed up with the zoning board. They are fining her $185,000!!!!!!!! And the house has been in family for generations.
http://www.seacoastonline.com/news/0...news/61060.htm

[Prometheus]

I'm not coming out in defence of property taxes, but I don't know why they are much worse then a tax that increases because you make more. I see them as being equally sociolist.

[RVonse]

Quote by: YourTokah My grandmother is 83 years old. She has lived in the same house for over sixty years. She and her husband bought it, built it up, and paid it off. Now she has to continue to pay a property tax every year well over a thousand dollars. She is too old to work and in poor health. In the past several years, she's been threatened by the government that she will be out on the street if she can't pay her property taxes - the whole family has tried to pull together to pay them each year, but none of us are exactly rich, either, and we have our own taxes to pay. At what point should she have to stop paying taxes? I say when you own your home free and clear and/or when you are old enough to draw social security benefits, or you draw disability benefits because your are permanently disabled, you shouldn't have to pay property taxes.

Prometheus pretty much has it right. The taxes are for the local city and school system. Theoretically, your grandmother has the right to sell her house and buy something else out in the middle of the country somewhere. A rural house out in the middle of nowhere is going to have very low property taxes. Unfortunately it will also have very little government services too. For example, if she gets sick there will be no one to come right away with an ambulance.

In your grandmothers situation, I think she should sell the house to you and then pay you rent out of that money. That way her life is uninterupted and she can continue to live in peace. After she passes away then you can sell the house and hopefully make a profit too.

[SteveA]

Quote by: Prometheus I'm not coming out in defence of property taxes, but I don't know why they are much worse then a tax that increases because you make more. I see them as being equally sociolist.

Yes, but a tax on income at least leaves a percent that's untouchable. Government takes their cut but the rest is yours to do with as you like.

Property taxes are different in that you can never pay off the dept. Imagine if government taxed you a percent of your bank account every year, it would be like taking everything and turning it into sand that continually slips through your fingers.

This is why I prefer an income or sales tax over property taxes. One way you pay your dues but can feel assured you can keep the rest, while the other effectively places someone else as the owner and you must continually earn dollars to keep possession of it (with the risk you'll run into a temporary hardship and lose it all too).

[YourTokah]

I simply don't think it's right. In my grandma's town, the property taxes include the school taxes, monies to pay for the operation of the various schools in the area.... Obviously, she doesn't require the services of any of these schools. I'm sure she would love to give money to the school system could she afford it, but she lives on a very small income. The idea that she could lose her home, her home for over sixty years now that she and her husband built up from nothing, because of her inability to pay taxes on it when she stopped paying the mortgage years and years ago, is ludicrous. While I understand what the money is being used for and that most of it can be necessary, I believe that we should have a more defined and inclusive exemption policy when it comes to property taxes. If you're over a certain age or you're disabled, you shouldn't have to pay them. Let everyone else pick up the slack, or add a 1cent gas tax (like one more penny will matter with these prices) - sooner or later, people should be able to reach a point where they don't have to worry about property taxes. I guess my 401k is going to have to include money to pay property taxes every year for the rest of my life. Which is friggin ridiculous.

[SteveA]

Quote by: YourTokah I simply don't think it's right. In my grandma's town, the property taxes include the school taxes, monies to pay for the operation of the various schools in the area.... Obviously, she doesn't require the services of any of these schools. I'm sure she would love to give money to the school system could she afford it, but she lives on a very small income. The idea that she could lose her home, her home for over sixty years now that she and her husband built up from nothing, because of her inability to pay taxes on it when she stopped paying the mortgage years and years ago, is ludicrous. While I understand what the money is being used for and that most of it can be necessary, I believe that we should have a more defined and inclusive exemption policy when it comes to property taxes. If you're over a certain age or you're disabled, you shouldn't have to pay them. Let everyone else pick up the slack, or add a 1cent gas tax (like one more penny will matter with these prices) - sooner or later, people should be able to reach a point where they don't have to worry about property taxes. I guess my 401k is going to have to include money to pay property taxes every year for the rest of my life. Which is friggin ridiculous.

The real solution is to lower or remove property taxes. If you just pass the burdens on to other people, they won't have enough money to pay their mortgage or provide for themselves either.

An alternative idea I'd had before about property taxes was to instead of have it an annual fee, instead make it like an extended lease, where you can prepay for so many years so in the event something happens you don't lose the property right away.

But the real problem is that government is taking and wasting too much, period. It doesn't matter how you shuffle it around, it's going to hit someone, which could be a child or a single mother or even someone trying to save up to have a home also. There are so many inefficiencies created through these things that it tends to drag everyone down.

On that article I posted above, a lot of people went to protest the actions that were taken against that family. I'd recommend getting together some people in the area and at least make it known that if she loses her property it's another black mark on the public record.

The thing that bothers me most is that the government didn't create the land and the houses weren't funded by public resources so there seems no legitimate claim to ownership. The reason why property taxes are so common though is because they know where to come to collect :(.

There might be a way she could share the place with someone else and charge some rent to help pay the taxes or possibly some private charity or church could help some.

Regarding the renting, many people think property taxes only hit the owners of the property ... nope, guess what bill is stuck on your rent every month. If you're living somewhere there's a property tax, you're paying it in one form or another.

[mr.perfecto]

Well, they could just attach a lien to the property and collect when she sells or after she passes on. Just a thought.

[Forseti]

The goverment is not concerned about your grandmother and any one else that is not able yo give them their money. So you better plan for property taxes in your 401k. And really they can't be. The goverment has set up laws and taxes and they must be carried out in every case. Other wise it would lead to abuse of the system. It's a hard truth.
I do agree that property taxes are crap but then again I believe strongly in the free market and hate any thing socialist. With the exception of anti trust laws but thats off subject.