Tax Rates

[99Saturn]

Originally Posted By: gathermewool

1. Any percentage return, even the piddling amount garnered from a savings account, is greater than ZERO.

2.I don't have a savings account, since my checking rate of return is just a little lower than that of the savings account. I try to keep most of what I need semi-liquid in mutual funds, which offer much better than zero rate of return (at least recently.)

3. I don't understand what you mean we about paying interest and penalties. I claim the max amount of exemptions that I can, instead of claiming zero and/or having more withheld in order to receive a larger return.

I always get a little back, but would have less take a out each paycheck if doing so was legal.


I agree with your points, probably works perfectly for you (and most people). In my experience penalties typically come up because of a large change that people forget to make a quarterly payment for. Situations like 401K rollovers and capital gains.

However, one other I've encountered is income in one state and residency in another. Proper deductions seem to baffle employees, employers and both states - at least that is what I have seen. Compounded by the fact that NY seems to estimate low even with the proper amount of exemptions.

 

[surfstar]

I don't pay any real estate tax (I rent)...

If you don't want to pay Federal and State taxes here in the USA - guess what? -its a free country and you can leave at any time!!!

 

[hattaresguy]

Cayman, no taxes on anything once your in!

 

[supton]

Originally Posted By: surfstar
I don't pay any real estate tax (I rent)...

If you don't want to pay Federal and State taxes here in the USA - guess what? -its a free country and you can leave at any time!!!


Correction: I counted seven states with no state income tax. You could move to one of those. Odds are, most of them make up for the revenue loss in other ways. The property tax I pay is something like $17/$1k, and home values are on the high end in NH; not sure how that compares elsewhere.

Technically you *do* pay real estate tax. Your landlord certainly does; and he/she pays that from... the rent you paid them. [I know you know this, but it seems important to point out just the same.]

Oh for fun: http://xfinity.comcast.net/slideshow/finance-propertytaxes/states-with-the-worst-property-taxes /

 

[Quattro Pete]

Originally Posted By: supton
Correction: I counted seven states with no state income tax. You could move to one of those. Odds are, most of them make up for the revenue loss in other ways. The property tax I pay is something like $17/$1k, and home values are on the high end in NH; not sure how that compares elsewhere.

I pay tax of about $23 per $1K in property value (using actual value). And then there is 5% IL state income tax. And then there is sales tax of somewhere around 8-9%.

 

[Cujet]

Florida:

6% sales tax
No income tax
No personal property tax
Real Estate taxes in Palm Beach County are roughly $21to $25/$1000

Any way you slice it, FL is a prosperous state and financially responsible. While placing a minimal tax burden on residents. If it can be done properly here, why is it such a problem elsewhere?

The answer is self evident. Corruption.

 

[PandaBear]

It is not going to be meaningful unless you factor in the sales tax and property tax.

 

[PandaBear]

Originally Posted By: zzyzzx
Originally Posted By: gathermewool
I want as little back from Uncle Sam as possible. Ideally, i'd prefer to pay every year. To heck with giving out an interest-free loan...


It's not like your bank account is paying interest. I'd rather give an interest free loan than pay interest and penalties.


but if he is like most people with a mortgage, it would be comparable to paying extra on the loan a few months early.

 

[gathermewool]

Originally Posted By: PandaBear
Originally Posted By: zzyzzx
Originally Posted By: gathermewool
I want as little back from Uncle Sam as possible. Ideally, i'd prefer to pay every year. To heck with giving out an interest-free loan...


It's not like your bank account is paying interest. I'd rather give an interest free loan than pay interest and penalties.


but if he is like most people with a mortgage, it would be comparable to paying extra on the loan a few months early.


I've got a 3.5% APR for 15 years, so paying of my mortgage early doesn't make much sense either. That is, unless the bottom falls out of this "recovery"............

 

[Cujet]

Another tax misunderstanding. For tax comparisons, real estate taxes should be compared on a square foot basis. As we don't live in a dollar value.

Put this way, my 2400 square foot FL home taxes are 1/10th the taxes of a similar home in Silicon Valley. And 1/5 the taxes of a similar home within a 2 hour commute!

Any way you slice it, CA taxes are insane by comparison to FL.

 

[Pablo]

Originally Posted By: surfstar
I don't pay any real estate tax (I rent)...

 

[PandaBear]

Originally Posted By: Cujet
Put this way, my 2400 square foot FL home taxes are 1/10th the taxes of a similar home in Silicon Valley. And 1/5 the taxes of a similar home within a 2 hour commute!

Any way you slice it, CA taxes are insane by comparison to FL.


But what is your neighborhood's typical income vs Silicon Valley? Real estate prices are reflections of the buying power of the local residents. Without that, SV's price will not be where it is: 200k house + 800k land instead of 200k house + 50k land elsewhere.

You can always sell it after you retire to recoup your initial "investment", so you cannot look at your "bargain" of a low cost home the same way as a "bargain" car that only last you 20 years. People here tear down 70 year old house to rebuild all the time.

Another thing you may have forgotten: while CA's property price and tax is insane, if you buy a home and stick to it for a long time, Prop 13 will make sure the appraisal value / tax increase remains only a small percentage a year. So a lot of older people got lucky and their homes are taxed only at 400k instead of 800k.

 

[rjundi]

I find it interesting when folks are offended some folks pay no income tax since they don't exceed a bracket while others pay more and more.

The reality is everyone get the breaks of no income tax for first xxx dollars and as you climb brackets you pay the next rate until you are at the top.

Works for me.

 

[strat81]

Originally Posted By: Cujet
Florida:

6% sales tax
No income tax
No personal property tax
Real Estate taxes in Palm Beach County are roughly $21to $25/$1000

Any way you slice it, FL is a prosperous state and financially responsible. While placing a minimal tax burden on residents. If it can be done properly here, why is it such a problem elsewhere?

The answer is self evident. Corruption.


Doesn't Florida tax investment holdings? That is, Joe Schmoe pays an x% tax on the individual stocks and mutual funds he owns?

 

[javacontour]

Which means younger folks with families to raise are footing the bill for those getting a pass on the tax rates.

But that's a topic for another place.

Originally Posted By: PandaBear
Originally Posted By: Cujet
Put this way, my 2400 square foot FL home taxes are 1/10th the taxes of a similar home in Silicon Valley. And 1/5 the taxes of a similar home within a 2 hour commute!

Any way you slice it, CA taxes are insane by comparison to FL.


But what is your neighborhood's typical income vs Silicon Valley? Real estate prices are reflections of the buying power of the local residents. Without that, SV's price will not be where it is: 200k house + 800k land instead of 200k house + 50k land elsewhere.

You can always sell it after you retire to recoup your initial "investment", so you cannot look at your "bargain" of a low cost home the same way as a "bargain" car that only last you 20 years. People here tear down 70 year old house to rebuild all the time.

Another thing you may have forgotten: while CA's property price and tax is insane, if you buy a home and stick to it for a long time, Prop 13 will make sure the appraisal value / tax increase remains only a small percentage a year. So a lot of older people got lucky and their homes are taxed only at 400k instead of 800k.

 

[Cujet]

Originally Posted By: PandaBear
Originally Posted By: Cujet
Put this way, my 2400 square foot FL home taxes are 1/10th the taxes of a similar home in Silicon Valley. And 1/5 the taxes of a similar home within a 2 hour commute!

Any way you slice it, CA taxes are insane by comparison to FL.


But what is your neighborhood's typical income vs Silicon Valley? Real estate prices are reflections of the buying power of the local residents. Without that, SV's price will not be where it is: 200k house + 800k land instead of 200k house + 50k land elsewhere.

You can always sell it after you retire to recoup your initial "investment", so you cannot look at your "bargain" of a low cost home the same way as a "bargain" car that only last you 20 years. People here tear down 70 year old house to rebuild all the time.

Another thing you may have forgotten: while CA's property price and tax is insane, if you buy a home and stick to it for a long time, Prop 13 will make sure the appraisal value / tax increase remains only a small percentage a year. So a lot of older people got lucky and their homes are taxed only at 400k instead of 800k.


FL has a nearly identical thing to Prop 13, with portability too.

My 2400 Sq/ft, very nice home on 2 acres, might be worth $230K to $270K. About right as far as I am concerned.

Income here is nowhere near S-V CA.

I can never defend stupidly inflated prices. To move to CA, I'd go broke, spending my entire retirement on the move (2 tractor trailers to move me and my machine shop) plus the cost of housing. The risk is HUGE that I'd lose my job, and not be able to find similar income there. And that the home would not maintain it's absurd value, thereby squandering my retirement.

 

[Win]

Originally Posted By: Pablo
Originally Posted By: surfstar
I don't pay any real estate tax (I rent)...

I had a good chuckle at that myself.

Maybe the tax fairy is paying them.

 

[surfstar]

Originally Posted By: Win
Originally Posted By: Pablo
Originally Posted By: surfstar
I don't pay any real estate tax (I rent)...

I had a good chuckle at that myself.

Maybe the tax fairy is paying them.



I thought some might appreciate that

 

[javacontour]

The tax fairy is pretty much the same as the tooth fairy!

 

[Cujet]

Originally Posted By: strat81
Doesn't Florida tax investment holdings? That is, Joe Schmoe pays an x% tax on the individual stocks and mutual funds he owns?


No. Florida does not tax investment income or earned income.