Tax rant.... (Williamsburg, Floyd: environment, property taxes, health insurance)

[MyCitySearchName]

Whilst shopping for a new location to move myself and my small business, I recently decided that Virginia was the place for me, until I really I began digging deeper into the workings of small business tax in Virginia.

I kept reading that VA is tax friendly this, and is ranked tax friendly that...and then I began reading all of the crap that Virginia is taxing and the picture isn't quite as rosy as it used to be. Particularly in the area equipment. It isn't bad enough that my income is taxed, but then I pay a sales tax on anything I purchase, AND THEN it seems the bureaucrats in VA wanna kick you when your down and tax everything relating to your business every single year for the rest of your residency there. My equipment isn't inexpensive and I don't relish the thought of continually paying for things I've already purchased.

WTF is that about? So, if I wanna do business there, not only will I be initially triple taxed....from now on, everything I buy will be taxed year after year after year after year.....forever.

The tax rate depreciates until it gets to 20%, but so what. I have never even heard of anything like this before. What a crock.

Then there is the issue of having to pay property taxes on boats, vehicles, etc.....again...triple taxed.

Neighboring Tennessee seems to have a high sales tax at first, which steered me toward Virginia, but I got to thinking......yes the tax rate is 9.75% in TN, but in VA you have a 5% income tax (which TN doesn't have), and then you have a 5.75% sales tax. So, cumulatively you're actually paying 10.75% in tax.

I don't see how they can get away with marketing themselves as tax and business friendly with that kind of an environment.

I currently live in NM, which is ranked poorly in business for some reason, but all I pay every year is a $35 business license, and thats it.

My problem is that I fell in love with a certain VA community, and loved everything about it, until I read the tax structure. Now I'm conflicted in a big way. Do I settle for something in TN, or do I suck it up and pay out the wazoo to live in a nice community. (Floyd, VA...btw)

Anyway....maybe I've got it all wrong, or I'm not seeing the whole picture here.....maybe some of you can give me a little hope.

I was told by someone on this forum that the commerce website "encourages" you to report your property....implying that you could possibly dodge this tax if you felt like gambling......but I think the 1st time you got audited by the IRS....or had a burglary and had some of your equipment stolen and tried to claim it...that nosy government types could really make your life hell if they wanted to.....I don't know that I'm willing to risk that.

*sigh*

[williamsburgfan]

1) this forum is not the place to give/receive tax advice - particularly re: business. talk to a qualified tax professional.

2) all states have taxes, finding the best fit for your situation will take due diligence on your part. if you don't like the tax situation in one state go to another.

[MyCitySearchName]

Originally Posted by williamsburgfan

1) this forum is not the place to give/receive tax advice - particularly re: business. talk to a qualified tax professional.

2) all states have taxes, finding the best fit for your situation will take due diligence on your part. if you don't like the tax situation in one state go to another.

Well that was less than helpful.

1) I thought this forum was to talk about Virginia and living there. Maybe I'm wrong. I'm not asking anyone here to do my taxes for me. Why would it be wrong to get GENERAL ADVICE from people who already live there and experience the things I'm curious about. I know others aren't in my exact situation, but they may have pearls of wisdom to share and make me aware of some of the pitfalls or windfalls in relation to doing business in VA. Tax is one of the most complicated things there is....and I don't even know what I don't know.....so asking a "professional" a series of uneducated questions is just going to waste my time and theirs, until I'm actually there and settled and can give them specifics.

2)

finding the best fit for your situation will take due diligence on your part.

I thought thats what I was doing.....

I know all states have taxes, but some are more advantageous than others. I was just hoping I overlooked something here and maybe things weren't quite as bad as they initially seemed. I really like the community I've chosen. I've yet to find anything like it anywhere, but if I want to live there permanently I don't know whether I'm willing to pay that much in taxes. If I could get more input from business owners there about some of the advantages of doing business in Floyd, it would go a long way toward easing my concerns.

[Cattknap]

MyCity, WilliamsburgFan does not want to hear anything negative about Virginia, believe me I know. Should you say anything critical that he doesn't agree with, he is sarcastic, condescending and judgmental in his responses. He assumes you are stupid and treats you accordingly. He will make untrue statements in order to prove his point.

Anyway, in answer to your question, from my research Virginia falls in the middle with regards to overall taxation when compared to all of the other states. Here are a couple of websites that I hope will prove useful. There are quite a few states that have overall higher taxes than Virginia. Now as far as business taxes, I'm not sure about that...but I do think it is important to consider all taxes that you will be paying - it may be that overall, you would not be paying any more overall in Virginia than you would in many other states.

http://www.retirementliving.com/RLtaxes.html

http://moneycentral.msn.com/content/...sh/P111507.asp

[MyCitySearchName]

Originally Posted by Cattknap

...but I do think it is important to consider all taxes that you will be paying - it may be that overall, you would not be paying any more overall in Virginia than you would in many other states.

http://www.retirementliving.com/RLtaxes.html

http://moneycentral.msn.com/content/...sh/P111507.asp

I have actually made myself a chart using the info from the retirement living site, but I hadn't seen the other site, I'll check it out. Thanks for those. .....and for the encouragement.

All things considered....everything else there sounds wonderful....but I was just apprehensive about paying so much in different taxes and the local governments sticking their big noses into everything. I'm not a fan of big government.

[cloudcroft]

Cattknap,

Well, at least he is still allowed to post here.

Over in the TX forum, I've had some of my "not what we want to hear" posts deleted.

-- John D.

[seanpecor]

Virginia in 2006 had the 10th lowest tax burden in the nation at 9.5% of income. Tennessee had a lower tax burden at 8.6% of income. Virginia's median household income is $50,000 on average while in Tennessee it is only $37,000. So the actual dollar amount of personal taxes in Virginia is much higher than the 9.5% vs 8.6% would imply.

Still, I believe your revenue potential (as I understand it) is clearly higher in Virginia than it would be in Tennessee. Don't get too hung up on this tax or another. You may pay less taxes in TN than you would in VA. But consider other factors. Like crime, which in most cases is 100% worse in TN. For example, your car is twice is likely to be stolen in TN than it is in VA so that would clearly increase the cost of insurance coverage.

Health care in TN is in really bad shape. According to a national survey, people in TN paid about $600 more each year for the individual health insurance premium compared to VA. TN is 2nd in the nation for prescription drug spending but is 47th in the health status index. Go figure!

Choose the place where you'll be happiest. In general, TN and VA likely balance out expense-wise. However, I'd argue your income potential would be higher in VA.

Sean

[MyCitySearchName]

Thanks Sean,

You are always helpful.

My income will likely be the same in either place. My pricing scheme doesn't change unless my expenses go up, so the place with the lower taxes is always going to be more appealing. I'm not reliant on someone else's idea of a pay scale, thank goodness.

As I said in my post though.....I kept reading about how low the tax burden is in VA.....but I'm not understanding how thats possible with all the taxes I'm finding. I guess multiple small taxes in VA are still less than fewer, more expensive taxes in other states? I guess I won't totally comprehend until I move there. It just SEEMS like the tax burden is pretty high there, despite what all the websites say.

I haven't given up yet, but those issues sure make me pause. It seems several VA politicians are trying to raise taxes again and the government there likes to stick its nose into people's business. I just read about a poor guy who was trying to alleviate some of the ridiculous gas prices by making his own biodiesel there in Floyd county, and got arrested for his trouble. Granted he sold some to his neighbors as well, and he didn't have a license to do so, but he was charged with felony and misdemeanor charges......whatever.



Booooooo.....Heaven forbid you try to take care of yourself and your neighbors.

As far as crime....I guess the teacher/student sexual assault epidemic has finally come into its own in VA as well. I just read about that teacher in Floyd who was arrested for molesting a student. I'm sure that caused quite a commotion in such a small community.

The health care issues are certainly a nice change in VA, though.
........so is the weather actually.

[Cattknap]

Sean - where are you getting your statistics - they don't match anything that I have seen. Those are much more optimistic figures than are shown on the two links I posted above.

[MyCitySearchName]

Originally Posted by Cattknap

Sean - where are you getting your statistics - they don't match anything that I have seen. Those are much more optimistic figures than are shown on the two links I posted above.

Sean does his homework.....I've been talking to him for awhile....and he actually lives in the area I'm looking at.

I've seen those figures as well, from several sites......thats why I was so baffled at all the taxes that you actually pay and was wondering how they could be accurate.

The Virginia state commerce site, the Floyd county site, and a retirement guide tax site all list Virginia as being fairly tax friendly compared to the national average.