Property taxes: how do you cope? (low income, apartment, rental)

[Trainwreck20]

Originally Posted by Serious Conversation

Technically out of state purchases are required to be reported to the state for collection of the difference in sales taxes. If you shop at a VA store and have something delivered (like furniture) to a TN address, you get charged TN taxes. Amusingly enough, someone bought an old carpet warehouse on the VA side of the line and converted it into a storage unit where parts can be rented by the day. I've seen people have things officially delivered to that address to avoid paying the TN tax, then people either pick them up or small shops will just take it to TN with the technical VA address.

Ha! Love how any law can be 'gamed', to some extent.

I will say that it is difficult to 'hide' property taxes - you can't send them 'off-shore' and the number of deductions/exemptions is fairly straight-forward. If you live in some other state but own property in Texas, you WILL get taxed on that property. There are many pluses and minuses to property taxes but they are a) locally controlled b) somewhat controllable (you can buy a cheaper house) and c) hard to dodge.

Oh, and ask for a $5k raise if you are moving to Austin or SA.

[Clever nickname here]

Unless you have an AGI over $150K for a single filer or $300K for join both state income tax and property tax are deductible from your Federal income tax. Basically this issue only applies to earners in the top 2% of income.

[Trainwreck20]

Originally Posted by Clever nickname here

Unless you have an AGI over $150K for a single filer or $300K for join both state income tax and property tax are deductible from your Federal income tax. Basically this issue only applies to earners in the top 2% of income.

There is no state income tax, so you can 'replace' the deduction with sales tax.

[RMESMH]

Originally Posted by Serious Conversation

Ours are pretty normal for the county we are in. Granted, this is a poor area without a lot of jobs, but under $1,000 looks pretty common in much of the rural South and Midwest.

Property taxes: How does your county compare? - CNNMoney.com

It just seems like the property taxes would be a huge burden to anyone thinking of owning a home, and skewing more people toward renting.



The dividend and interest tax is going away fairly soon. This would primarily impact retirees and those with lots of dividend and interest income, and that's not me.

The sales taxes are oppressive and higher than anywhere else I've lived. Fortunately, I live around ten miles from the Virginia border and do most of my shopping in Virginia. Sales tax is only around 4% there.

Yeah, I heard the Hall Tax is probably going away by 2022 at the latest.

Fayetteville, AR also has a high sales tax rate (state + local) and what is taxed and what isn't is an odd mix. I remember getting a quick breakfast at a Mickey D's there a few years ago and the total sales tax rate was about 11%.

Re correct property tax rates in Texas, look at the listings you like on HAR.com. When I first moved to Texas, IIRC, HAR.com just covered the Houston metro, but one can now search all around the state.

[H'ton]

Property taxes: How does your county compare? - CNNMoney.com

That map of the United States shows how outrageous Property taxes are in Texas.

It's a huge reason why I continue to rent and then save the money I don't have to pay for home ownership (property taxes, insurance, maintenance, closing costs, interest, etc.). I save the excess money in investments instruments that typically outperform single family residential anyway.

I know rent includes taxes but its a predictable monthly rate and if I don't like it I can always move. With home ownership you have less control. What if your house goes up 100k, as one poster mentioned. That poster mentioned that they pay $8,500 a year in property taxes. IF it stays at that rate, that is $85,000 for a ten year period or $170,000 just in taxes for a twenty year period!
If you move, realtor fees/closing cost encompass 6% so yes home ownership in Texas is very expensive.

For those with property taxes...say your rate is 2.5%. What is the actual amount you pay after exemptions/ deductions?

[Lowexpectations]

I pay roughly 1k a month in property taxes and it's just a cost of doing business. I'd rather that than state income tax though

[Lowexpectations]

Originally Posted by Clever nickname here

Unless you have an AGI over $150K for a single filer or $300K for join both state income tax and property tax are deductible from your Federal income tax. Basically this issue only applies to earners in the top 2% of income.

These deductions are only beneficial if you itemize just like mortgage interest deductions

[Lowexpectations]

Originally Posted by H'ton

Property taxes: How does your county compare? - CNNMoney.com

That map of the United States shows how outrageous Property taxes are in Texas.

It's a huge reason why I continue to rent and then save the money I don't have to pay for home ownership (property taxes, insurance, maintenance, closing costs, interest, etc.). I save the excess money in investments instruments that typically outperform single family residential anyway.

I know rent includes taxes but its a predictable monthly rate and if I don't like it I can always move. With home ownership you have less control. What if your house goes up 100k, as one poster mentioned. That poster mentioned that they pay $8,500 a year in property taxes. IF it stays at that rate, that is $85,000 for a ten year period or $170,000 just in taxes for a twenty year period!
If you move, realtor fees/closing cost encompass 6% so yes home ownership in Texas is very expensive.

For those with property taxes...say your rate is 2.5%. What is the actual amount you pay after exemptions/ deductions?

It depends on the area. The exemptions and how they apply vary. My total rate is 2.5% or so but under 2% effective after exemptions in Houston. When I lived in the suburbs it was over 3% total and just under that effective because the school district and utility district didn't apply the same exemption that the county did

[KathrynAragon]

Originally Posted by H'ton

Property taxes: How does your county compare? - CNNMoney.com

That map of the United States shows how outrageous Property taxes are in Texas.

It's a huge reason why I continue to rent and then save the money I don't have to pay for home ownership (property taxes, insurance, maintenance, closing costs, interest, etc.). I save the excess money in investments instruments that typically outperform single family residential anyway.

I know rent includes taxes but its a predictable monthly rate and if I don't like it I can always move. With home ownership you have less control. What if your house goes up 100k, as one poster mentioned. That poster mentioned that they pay $8,500 a year in property taxes. IF it stays at that rate, that is $85,000 for a ten year period or $170,000 just in taxes for a twenty year period!
If you move, realtor fees/closing cost encompass 6% so yes home ownership in Texas is very expensive.

For those with property taxes...say your rate is 2.5%. What is the actual amount you pay after exemptions/ deductions?

We pay about $4000 a year in property taxes on a home in the Tyler area, which is an upper middle class home in a desirable neighborhood, 2500 square feet and it appraises for about $260,000. However, I looked up the average income tax rate in the US for our income bracket and it would be MUCH more than $4000 so we come out way ahead tax wise living in Texas. In fact, our property taxes could double and we'd still be way ahead. So yeah - I'm staying in Texas and will continue to enjoy being a home owner.

[KathrynAragon]

Originally Posted by Lowexpectations

These deductions are only beneficial if you itemize just like mortgage interest deductions

So itemize - it's not difficult to do. It's a one page form. Super easy to fill out.