Public Employee Unions want to change Prop. 13 so busness property tax goes up & up more every year. (2015, how much)

[shooting4life]

Originally Posted by Ultrarunner

I buy a new chainsaw... I pay tax depending on where it was bought.

I buy a car and I pay tax depending on where I live.

I earn wages and the taxes paid are based on earnings.

I sell stock... (Which I don't have) and I pay on profit based as income or long term holding.

Property tax by its very nature is insidious... under the old plan... someone could come into a neighborhood and pay an over the top price and everyone suffers...

There is no real gain/loss until a property changes hands... anything else is just a speculation or estimate of value based on assumptions.

Even an appeal can take years... meanwhile the taxes billed must be paid in full... how fair is that?

When you buy a car you pay registration based on the value of said vehicle. If it happens to go up (rare I know) you pay more in registration.

You are comparing multiple types of taxes, most of which does not make sense as a comparison.

Then get rid of property taxes all together of the are insidious. All I am asking is that the tax rate be applied equally to all property owners. Not the government picking winners and losers.

[Ultrarunner]

Originally Posted by CA4Now

We realize that you're an entrepreneur. Unfortunately, most of us aren't (and would never have the time, $, or ability to pursue forming a corporation). Property tax loopholes available to corporations are still not fair.

Your dry cleaner and his wife are running a corporation because they WORK THERE. Most of us are not in that circumstance.



No one here is talking about overturning Prop 13 for homeowners, just closing the loophole for corporations.

For the record I do not nor have I ever owned or been a principal in a corporation outside of a few mutual funds through a 401k that would even amount to the price of a new car...

That said... I do seem to know a lot of small business people that are Corporations... mostly family held... everyone from small family farms, construction contractors and small business owners that are either mom and pop of family corps...

Some would argue the double taxation of Corps is not fair on distributions to owners...

The actual cost of a basic corp is very low... heck... one Amway rep I know is a corporation of one...

Many choose Corp as a way to limit liability... nothing more or less when dealing with Mom and Pop and family corps...

My Grandfather had a Corp with him and my Grandmother as sole shareholders... he passed away in 1973 so it is before my time... it is not rocket science if benefits outweigh the liabilities.

As mentioned... Prop 13 would have never come into being if the Legislature would have simply indexed the Home Owner tax exemption for inflation... even something so simple could not be achieved in Sacramento...

Think about it... people actually living in the home they own, with or without a mortgage, would have some protections... all other real estate in the state would have been business as usual.

[Ultrarunner]

Originally Posted by shooting4life

When you buy a car you pay registration based on the value of said vehicle. If it happens to go up (rare I know) you pay more in registration.

You are comparing multiple types of taxes, most of which does not make sense as a comparison.

Then get rid of property taxes all together of the are insidious. All I am asking is that the tax rate be applied equally to all property owners. Not the government picking winners and losers.

Prop 13 was not about government picking winners or losers.... in fact the government did all in it's power to thwart it at every step of the way...

Prop 13 was about voters taking a stand... both property owners and non-property owners... corps have no vote.

I compared various taxes because the post I responded to simply said taxes...

To be accurate... property tax, under Prop 13 is NOT fixed... Prop 13 provides for a 2% annual cap for inflation... in 10 years that is almost 25% because the successive 2% builds on the previous 2%...

As for cars... I have never sold a car for less than I paid for it... ever.

I tend to buy old cars... especially when I was in school... drive it for 6 months or a year and sell...

My registrations go down each year until they hit the minimums...

California actually gets less car tax money from me since it raised the cost... I simply went Non-Op on most of them...

There is a call collector I personally know and have driven his 1966 AC Cobra... he bought it for 20k in the early 1970's... what's it worth today... half a million.. a million who knows?

I do know the value runs parallel to California home prices... his annual registration is under a $100...

When he dies it will probably go out of California because the sales tax on a million dollar car would be 100k...

[2sleepy]

Originally Posted by CA4Now

We realize that you're an entrepreneur. Unfortunately, most of us aren't (and would never have the time, $, or ability to pursue forming a corporation). Property tax loopholes available to corporations are still not fair.

Your dry cleaner and his wife are running a corporation because they WORK THERE. Most of us are not in that circumstance.



No one here is talking about overturning Prop 13 for homeowners, just closing the loophole for corporations.

exactly

[2sleepy]

Originally Posted by Ultrarunner

For the record I do not nor have I ever owned or been a principal in a corporation outside of a few mutual funds through a 401k that would even amount to the price of a new car...

That said... I do seem to know a lot of small business people that are Corporations... mostly family held... everyone from small family farms, construction contractors and small business owners that are either mom and pop of family corps...

Some would argue the double taxation of Corps is not fair on distributions to owners...

The actual cost of a basic corp is very low... heck... one Amway rep I know is a corporation of one...

Many choose Corp as a way to limit liability... nothing more or less when dealing with Mom and Pop and family corps...

My Grandfather had a Corp with him and my Grandmother as sole shareholders... he passed away in 1973 so it is before my time... it is not rocket science if benefits outweigh the liabilities.

As mentioned... Prop 13 would have never come into being if the Legislature would have simply indexed the Home Owner tax exemption for inflation... even something so simple could not be achieved in Sacramento...

Think about it... people actually living in the home they own, with or without a mortgage, would have some protections... all other real estate in the state would have been business as usual.

How is it double taxation to reassess property when it changes hands? It happens to every homeowner unless they are transferring to their kids or spouse. We are talking about someone selling their property to 3 or more buyers, retaining a minority interest, then after the sale of the property selling their remaining interest to the new buyers which are exempt from reassessment. - geezus if that isn't a loophole then I don't know what is.

[2sleepy]

Originally Posted by Ultrarunner

Got it this time...

Sounds like a nightmare just to keep up with reporting requirements...

On one hand the State and Governor has said California needs to encourage business and legislation like this does just the opposite...

so we have to create loopholes in order to encourage business? Sorry, I just don't buy it

[Ultrarunner]

How do you define a home owner?

Could be one home per tax payer?

Could be a residence requirement?

Could apply to residential zoned or not?

What about mixed use... like the Dry Cleaner that lives over his shop in San Francisco?

What about renters... since it is a business use... would rental property be subject to regular review?

Then we have LLC and several forms of Corps...

If the desire is to protect homeowners... what about those that live in a 5 million dollar home in Carmel and those in a 100k condo in Bakersfield???

It is a very slippery slope when standing tax law is meddle with and I am talking about unintended consequences...

Falling values could trigger a bigger burst Bubble than the last... even if Only commercial real estate is affected.

If a corp makes money it is taxed and the money is taxed double on distributions...

[Ultrarunner]

Originally Posted by 2sleepy

so we have to create loopholes in order to encourage business? Sorry, I just don't buy it

Talk to the Governor on that one... the giveaway of tax dollars happens all the time to those too big to fail...

[Ultrarunner]

Originally Posted by 2sleepy

How is it double taxation to reassess property when it changes hands? It happens to every homeowner unless they are transferring to their kids or spouse. We are talking about someone selling their property to 3 or more buyers, retaining a minority interest, then after the sale of the property selling their remaining interest to the new buyers which are exempt from reassessment. - geezus if that isn't a loophole then I don't know what is.

A corporation pay taxes on profit...

When a corporation distributes this profit to shareholder... the shareholders are again subject to tax...

[2sleepy]

Originally Posted by Ultrarunner

A corporation pay taxes on profit...

When a corporation distributes this profit to shareholder... the shareholders are again subject to tax...

what does that have to do with a corporation paying tax on the purchase price of commercial property?