Texans actually pay more in taxes than Californians do? (Austin: how much, home)

[blameyourself]

Originally Posted by oil capital

It might be time for a few "clarifications" regarding Texas property taxes after retirement (age 65).

1) When you hit age 65, you get a larger homestead exemption. This is quite substantial. My taxes dropped $3,000 per year (about a 35% reduction).

2) You are eligible to have your taxes deferred. They are deferred until you sell your home. NO TAXES have to be paid until the home is sold.

3) School property taxes (typically around 65% of your total tax bill) are frozen when you hit 65. NO INCREASES.

4) A new law that went into effect will unfreeze and lower school property taxes for seniors in certain circumstances.

5) Appraisal increases capped at 10% per year (as discussed above).

#2 was already addressed but clearly you didn't bother to read it. The fact that one should have to defer taxes alone should tell you that property taxes are too high. As for the system in play, it's nothing short of loan shark terms. Projecting out for the next 5 years, our property taxes will go from $13k to $20k and if I defer, that means in addition to the property tax, I'll have to pay an additional $1k a year (cool plan). And while the Williamson country exemption of $125k, knocks off about $3700, that still amounts to about $16k, so $800 extra. I also find it amusing how you seem to want to downplay a 10% increase (that's actually quite substantial and I think most people would prefer 2%). I'll respond to the rest of the stuff tomorrow since there seems to be some dancing going on here. Clearly Texas has some of the most exorbitant property taxes in the country for established residents.

Originally Posted by blameyourself

I don't find it very complicated. I just think there are too many cheerleaders that will cut off their nose to spite their face. And lord forbid you talk about an income tax because that's taboo. In the meantime, people will be forced out by their property taxes by the time they get to retirement. Of course, there will also be those saying "don't worry about it...you can defer your property tax when you retire"...yeah, that's a great plan (especially at 5% interest). Lord forbid you have to sell your home to cover some end of life medical expenses only to find you have little equity due to property tax deferrals.

[blameyourself]

Originally Posted by oil capital

It might be time for a few "clarifications" regarding Texas property taxes after retirement (age 65).

1) When you hit age 65, you get a larger homestead exemption. This is quite substantial. My taxes dropped $3,000 per year (about a 35% reduction).

2) You are eligible to have your taxes deferred. They are deferred until you sell your home. NO TAXES have to be paid until the home is sold.

3) School property taxes (typically around 65% of your total tax bill) are frozen when you hit 65. NO INCREASES.

4) A new law that went into effect will unfreeze and lower school property taxes for seniors in certain circumstances.

5) Appraisal increases capped at 10% per year (as discussed above).

#3 So what. Being frozen doesn't mean you're not paying them, it just means there's no increase. If it's already high, freezing them isn't making that much of a difference.

#5 Already mentioned, but 10% is significant

If you're somehow trying to imply that property taxes in Texas aren't punitive compared to California, you're kidding yourself. California has a much better system for established residents and retirees. This isn't even an argument worth having and it's silly to try and defend it. And people indeed are going to be priced out of their homes if it continues.

[hschulz3]

I find the property taxes between California and Texas to be pretty much a wash. California has lower rates, but much higher property values. My house in Texas is about twice as large as California, but I have paid the same property taxes that would have been paid on my California house (due to value increases) since 2008.

What people are noting is that California's property tax rates are affected (effectively capped) by Prop 13...but there is a push to undo it. If that happens (and I think there is a good chance that it will), then this thread becomes laughable. As it stands, I would pay much more in taxes if I still lived in California.

However, I would also like to restructure Texas' property taxes. I don't like the notion that I effectively do not "own" my house because of the property taxes.

[oil capital]

Originally Posted by blameyourself

No it doesn't and it's merely a deflection tactic. I could buy a mansion in Youngstown, Ohio right now that would be significantly bigger than our Texas home. But why would I? Housing prices are based on desirability to live somewhere and that includes a myriad of factors. If you want to have a discussion on that, feel free to start another thread and I'll be happy to engage you. But I have no intention of wasting time going down that rabbit hole and hijack this thread. It's off topic.

Nevertheless, a comparison of dollar amounts of property taxes paid without knowing anything about the property is meaningless.

[blameyourself]

Originally Posted by hschulz3

I find the property taxes between California and Texas to be pretty much a wash. California has lower rates, but much higher property values. My house in Texas is about twice as large as California, but I have paid the same property taxes that would have been paid on my California house (due to value increases) since 2008.

What people are noting is that California's property tax rates are affected (effectively capped) by Prop 13...but there is a push to undo it. If that happens (and I think there is a good chance that it will), then this thread becomes laughable. As it stands, I would pay much more in taxes if I still lived in California.

However, I would also like to restructure Texas' property taxes. I don't like the notion that I effectively do not "own" my house because of the property taxes.

You clearly are not aware of how many failed challenges that have been made to Prop 13 (the most current being Prop 15 which also failed). It's not going anywhere.

If you lived in California for any length of time, your property tax value would be lower than a home in Texas. The issue with Texas is the long term impact to property taxes with the 10% increases per year which will be in play for quite some time.

[blameyourself]

Originally Posted by oil capital

Nevertheless, a comparison of dollar amounts of property taxes paid without knowing anything about the property is meaningless.

As stated, feel free to start another thread if you like and I'll be happy to comment on the desirability and how it relates to home prices between the two states (which is off topic for this thread), which is the most relevant part as opposed to an individual house.

[hschulz3]

Originally Posted by blameyourself

You clearly are not aware of how many failed challenges that have been made to Prop 13 (the most current being Prop 15 which also failed). It's not going anywhere.

If you lived in California for any length of time, your property tax value would be lower than a home in Texas. The issue with Texas is the long term impact to property taxes with the 10% increases per year which will be in play for quite some time.

I lived in California for nearly 20 years. I still have a business out there. I am well acquainted with the prior efforts to overturn Prop 13. But demographics change, as does thinking about which groups deserve "protection" against taxes and those that do not. California used to be a red state. It is no longer. Recent attacks on Prop 13 have focused on "equity." It will be interesting to see what becomes of the Board of Equalization...

As for your second point, you are probably right - I am probably close to the point where my Prop 13 lock would have my property taxes be about the same as my current property taxes in Texas. But, I am still way ahead on overall taxes.

[blameyourself]

Originally Posted by hschulz3

I lived in California for nearly 20 years. I still have a business out there. I am well acquainted with the prior efforts to overturn Prop 13. But demographics change, as does thinking about which groups deserve "protection" against taxes and those that do not. California used to be a red state. It is no longer. Recent attacks on Prop 13 have focused on "equity." It will be interesting to see what becomes of the Board of Equalization...

As for your second point, you are probably right - I am probably close to the point where my Prop 13 lock would have my property taxes be about the same as my current property taxes in Texas. But, I am still way ahead on overall taxes.

We purchased in 1994 and pay roughly $6k. One next door neighbor that bought about 7 years prior to us is in the $5K range and another one that bought some 9 years ago is in the $9k range. My FILs duplex that will sell for between $2.3 and $2.4 million has property taxes in the $2k range. Clearly it depends on when you bought and your acquisition cost. For most long-term residents, property taxes are quite low compared to Texas. As stated, my concern is more about the long-term impact with 10% increases per year.

[hschulz3]

Originally Posted by blameyourself

We purchased in 1994 and pay roughly $6k. One next door neighbor that bought about 7 years prior to us is in the $5K range and another one that bought some 9 years ago is in the $9k range. My FILs duplex that will sell for between $2.3 and $2.4 million has property taxes in the $2k range. Clearly it depends on when you bought and your acquisition cost. For most long-term residents, property taxes are quite low compared to Texas. As stated, my concern is more about the long-term impact with 10% increases per year.

Totally agree. While Texas property values remained relatively flat, the higher tax rates were not a problem. But now that property values have gone up, it is easily foreseeable that the tax rates will become burdensome. Probably two ways to go to change this - some sort of Prop 13 lock, or a rate decrease and (possibly) some sort of other tax (e.g., sales tax) increase.

[EDS_]

Originally Posted by oil capital

Nevertheless, a comparison of dollar amounts of property taxes paid without knowing anything about the property is meaningless.

Thank you.


For reasons I don't quite understand people fixate on TX property taxes.