U.S. CitiesCity-Data Forum Index
Go Back   City-Data Forum > General Forums > Real Estate > Mortgages
 [Register]
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
View detailed profile (Advanced) or search
site with Google Custom Search

Search Forums  (Advanced)
 
Old 09-16-2008, 04:47 AM
 
Location: Central CT, sometimes NH.
3,257 posts, read 4,931,915 times
Reputation: 3029

Advertisements

Quote:
Originally Posted by ndfmnlf View Post
There are reasons for renters to be renters, but they shouldn't have to subsidize homeowners. The government shouldn't favor one group over another using tax policy.
Renters by and large pay less in taxes than homeowners. Although real estate interest is tax deductible people still are paying the taxes locally. With renters the real estate tax is paid by the owner of the building which is always substantially lower than the per unit cost of single family homes. Therefore, the renter often does not end up paying their fair share for the services they receive.

A case-in-point is in my community where there are a high number of apartments and multi-family buildings. These buildings are taxed at a much lower per unit cost than the single family units in town. However, these buildings house many families with young children that add substantially to the education costs in the city. A 3 family that pays $3200 in annual taxes and houses three families with two children each results in $54,000 ($9,000 each) of annual education costs. Contrast that with a single family home that pays the same amount or higher in annual taxes yet only has two children.

I think that the deductibility issue should have its limits. I had suggested a fixed income tax rate with limited deductions including real estate deductions with a $7500 limit for a single filer or a $15,000 limit for a married couple. The details can be found in my plan, A Lincolnian Party Vision for America
Reply With Quote Quick reply to this message

 
Old 09-16-2008, 04:51 AM
 
955 posts, read 1,922,880 times
Reputation: 398
Default Take This To Its Logical Conclusion

Quote:
Originally Posted by ndfmnlf View Post
There are reasons for renters to be renters, but they shouldn't have to subsidize homeowners. The government shouldn't favor one group over another using tax policy.
You must take your point to its logical conclusion. The basic, underlying structure of our tax system is that it is a progressive tax. Therefore, by definition, our tax system favors one group over another. So I like where you are heading, which is a flat tax concept where everyone, regardless of individual situation, pays the exact pecentage.
Reply With Quote Quick reply to this message
 
Old 09-16-2008, 04:57 AM
 
1,567 posts, read 2,704,039 times
Reputation: 1262
Quote:
Originally Posted by Donn2390 View Post
Sounds like a good reason for renters to become homeowners. Everyone can buy a home if they want one. they might have to learn to live within a budget, or make some other sacrifices.
Some chose not to do so, let em weep
its idiots who thought like this that are about to end up homeless now
Reply With Quote Quick reply to this message
 
Old 09-16-2008, 05:30 AM
 
1,567 posts, read 2,704,039 times
Reputation: 1262
Quote:
Originally Posted by Donn2390 View Post
Excellant point, my property taxes ar just under $6000.00 a year..! How would you renters like that? Also, property insurance, and other expenses renters don't see. That stuff adds up. The reason for the tax break is simple. The Goverment wants everyone to own a home. They do all they can to make that possible.
If you chose not to be a property owner, fine, but don't cry because some enjoy the advantages of home ownership.
I say your complaining is just sour grapes...
its included in the rent genius
Reply With Quote Quick reply to this message
 
Old 09-16-2008, 05:33 AM
 
1,567 posts, read 2,704,039 times
Reputation: 1262
Quote:
Originally Posted by coldwine View Post
There is no evidence at all to support the theory that mortgage interest tax deductions affect renters. They don't.

If you're renting, you can't afford to buy. No one willingly shells out a crap ton of money for something they don't own forever. What about all of the single people who can't afford to buy houses/condos? If they didn't have that tax break they'd be royally screwed.

The deduction makes a huge difference to people who own homes. We don't always live in places where the mortgage interest is less than the standard deduction. In fact, increasingly the overwhelming majority of homeowners pay far more than ~$5,000 in interest alone. That doesn't include insurance and property taxes, all of which are insanely expensive.

We are a nation of owners, not renters. This should never change, and I'm quite happy that I get to deduct the cost of my interest.

Last but certainly not least, mortgage interest is a deduction because of the nature of interest, not due to any policy objective. Interest represents the cost of doing business, or in this case, the excess cost you didn't pay on your home. After all, interest is bundled into each payment and that certainly isn't your principal. All kinds of interest are deductible, not just mortgage interest. Mortgages aren't "personal" in nature, as in, I personally didn't lend someone else money and charge interest.

It's worth pointing out that rarely does a taxpayer receive as much of a tax break from the deduction as they paid out. It's an itemized deduction, meaning it just reduces taxable income but not total income. Proportionally the differences in what you pay (deduction vs. no deduction) aren't drastically different.

As a complete EDIT:

Lowering taxes doesn't actually help most people. Tax burdens are only truly onerous on successful white collar single people, and in that case our current tax system is designed to annihilate. I'd be amazed if most families in the United States really had issues because of taxes. Excepting the northeast corridor and Los Angeles, people get by very well without having to worry about paying taxes.

It's healthcare costs that are doing the most harm to people. We hear it so often that we're numb to the concept, but it's painfully true for everyone... Single or married. It's not even that they suck to begin with, it's that they're bad and getting worse at a time when the value of money is diminished. It well and truly blows.

you are so wrong its not even funny
think how much the avg person pays in taxes (all taxes not just income)
it is disgusting
its not just rich people who pay these taxes (albeit they pay way more than most of us)
Reply With Quote Quick reply to this message
 
Old 09-16-2008, 05:34 AM
 
1,567 posts, read 2,704,039 times
Reputation: 1262
an
Quote:
Originally Posted by f_m View Post
If it is not made affordable to the average person, then only investors would own most of the property. As it is, 1% of the people own most of the real estate anyway. Are you looking to have more real estate be owned by the small percent of rich?

In places where the cost of housing is high (5-10x median income) it is very helpful. In areas where the housing is lower (2-4x median income), it wouldn't make so much difference.

and if people bought what they could afford they wouldnt be in the mess they are now
Reply With Quote Quick reply to this message
 
Old 09-16-2008, 06:09 AM
 
1,567 posts, read 2,704,039 times
Reputation: 1262
Quote:
Originally Posted by mommytotwo View Post
LOL.

Sorry, just get heated up about the tax issue.

Let's look at our income as a pie.

You make a pie, the gov't takes a piece. Fine.

You make a bigger pie, they not only take a piece, but they take a bigger piece.

If you are self employed and pay taxes quarterly, then your first quarter payment (for jan, feb, mar) is due April 15. your second qt. payment (for april may june) is due JUNE 15.

anyone notice that the 2nd qt. payment is due before the second quarter is even finished! They are not even letting you finish making the money before they want their share.

They want their piece of the pie before it is even done cooking!!!!

So I have had it with taxes.

Plus, I just realized that I think today is the due date for the 3rd Qtr payment and I don't have it ready. I have just realized how I will spend my evening.
dammit i literly read this thread and just wrote a check
Reply With Quote Quick reply to this message
 
Old 09-16-2008, 08:46 AM
 
3,751 posts, read 10,262,829 times
Reputation: 6566
Haven't the time to read all this thread..

Hope someone else has mentioned the fact that there is a renter's tax credit?

Of course if you don't itemize, it doesn't help. But, yes, there is tax credit available for renters.
Reply With Quote Quick reply to this message
 
Old 09-16-2008, 10:56 AM
f_m
 
2,289 posts, read 7,388,088 times
Reputation: 868
Quote:
Originally Posted by bxlefty23 View Post
an


and if people bought what they could afford they wouldnt be in the mess they are now
That's sort of the whole point of the deduction, to help people afford the house price. You seem to be forgetting that the cost of living in various areas are significantly higher than in others (NYC, SF, LA, etc... compared to Kansas or Nebraska). The deduction helps proportionally to the loan amount, so in low priced areas it contributes less to the buyer. In higher priced areas it will help the buyer a little more.
Reply With Quote Quick reply to this message
 
Old 09-16-2008, 11:03 AM
f_m
 
2,289 posts, read 7,388,088 times
Reputation: 868
Quote:
Originally Posted by tony23 View Post
Just wondering where you get that figure from...
My statement was inaccurate (based on my recollection of something I read awhile back in a Robert G. Allen book). However, it is more like "The top 5 percent own more than half of all wealth."

Wealth and Income Inequality in the USA

This is a very basic statement, but seriously points out the "imbalance" in the distribution of not only wealth but power.
Reply With Quote Quick reply to this message
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.

Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.


Reply
Please update this thread with any new information or opinions. This open thread is still read by thousands of people, so we encourage all additional points of view.

Quick Reply
Message:

Over $104,000 in prizes was already given out to active posters on our forum and additional giveaways are planned!

Go Back   City-Data Forum > General Forums > Real Estate > Mortgages
Follow City-Data.com founder on our Forum or

All times are GMT -6.

2005-2018, Advameg, Inc.

City-Data.com - Archive 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35 - Top