Rossticus said:

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I think he means exempting the full value of homesteads from property tax.

But to his previous point, no. Texas politicians don't have the balls for that.

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Florida has way more vacation homes and investment properties than Texas does as a percentage of property.

txags92 said:

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Rossticus said:

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I think he means exempting the full value of homesteads from property tax.

But to his previous point, no. Texas politicians don't have the balls for that.

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Florida has way more vacation homes and investment properties than Texas does as a percentage of property.

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More vacation but more rentals? Not sure that's true.

EDIT - Florida has a higher % of home ownership - 68.4% vs 63.9%

https://fred.stlouisfed.org/series/TXHOWN

YouBet said:

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This. Until we solve how we are going to fund schools, nothing will change here. That's the crux of the entire thing.

There is no way we will replace a consistent funding stream (property taxes) with one that is way more variable. Until someone can show Austin how that will work then nothing is changing.

Texas is way different than Florida. Good luck getting our 5-6 huge liberal strongholds (which Florida does not have) and our rural republicans (who didn't want vouchers) on board the same plan that somehow continues a consistent funding stream to public schools.

I mean, seriously, lol good luck with that.

FTR, I would love to cut do away with property taxes but I do so knowing the replacement will be just another flavor of poison.

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The way you get there is the same way Florida did, you elect strong conservative leaders who understand good governance and follow through. In 2018 when DeSantis was first elected Florida was a 50/50 Purple state and it had liberal strongholds in multiple places. DeSantis has changed that completely to a state that is now arguably more red than Texas. It didn't happen overnight though.

DeSantis didn't focus so much on cuts as he did efficiency. Florida is top of the charts in education but they spend half of what NY does even though they have more population than NY. The services in Florida are also as good as you will find, highlighted by their disaster response. He hired very smart and competent people to essentially DOGE Florida and modernized everything. He went after anyone that was corrupt. He also was great at focusing on non partisan and popular ideas besides disasters such as Everglades preservation. He aggressively courted outside investment and businesses but not necessarily just giving them tax breaks, he lured them in with favorable regulations and aligning their talent needs by investing in things like trade schools.

All of this resulted in huge revenue spikes because of population growth combined with more efficient spending. So it allowed him to keep cutting taxes and paying off debt. Florida is now actually not that far from paying off their entire state debt and has the lowest per capita state debt of any state and dropping. Thus less money going to interest payments and more leverage in negotiating future debt if needed. Florida does have the advantage of having a higher proportion of OOS residents with 2nd homes and people with investment homes than most and those properties tend to be in the most expensive areas of the state, thus it makes it easier for him to help out residents while taxing non residents but that's fair.

So in short Texas has to be a lot more efficient and well governed. It's actually much harder here because we have a weak governor model and a lot more restrictions and a lot of bloat that has been covered up by "conservative" Republicans that DGAF about cutting spending. We don't have the same amount of OOS residents and investment property owners either as we aren't nearly the tourist destination Florida is. So we would likely have to find ways to get the money elsewhere from where we do have advantages, the most likely (and possibly difficult politically) is from O&G and Minerals as well as our massive exports out of places like the Port of Houston. Don't get greedy but there is money we can tax there for sure. The Texas Stock Exchange also has a LOT of potential if we allow that to grow and prosper but that's long term.

The biggest obstacle to me is breaking the mentality that people have that spending more money on education means better education. It astounds me how no matter how false that is people lap it up. Many of the best school districts spend half per student of what the worst ones do. It's about parental involvement and creating an environment that good teachers want to teach. The level of corruption and lack of accountability at some school districts is just astounding. The amount of bureaucracy and administration in some school districts that is paid far more than teachers is disgusting as well. Yet people keep voting for it and following along like sheep. School choice may be the only fix at this point because it will force schools to either do a better job or people will just opt for other options. The reality is that with modern technology our current system is very outdated, everything we think of in terms of how our educational system was designed was pre internet. Covid actually exposed a lot of that to people. A lot of teachers basically are just administrating what is already online and doing so inefficiently. Of course there are subjects and teachers that doesn't apply to but the goal of education has shifted more to socialization than education in many aspects.

Sorry if TLDR

I read "investment" to include short term rentals. Plenty of second home, vacation home, side hustle rent it out a few times a year... All the same house.

Definitely puts Florida in a very unique position when a very measurable percentage of your developed real estate is within walking distance (or a few miles) to a fantastic beach.

one safe place said:

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Property taxes are a wealth tax and need to go.

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Weak argument

There are plenty of places to store wealth other than real estate where you don't have to pay tax on unrealized gains. My Berkshire Hathaway stock I bought in 2020 has almost tripled since then, and I have not paid a dime in taxes on it. Same with the XOM I bought back then, but I do pay tax on the dividend.

As a reminder, in most cases you don't have to pay capital gains taxes when you sell a homestead.

Not to mention countless other tax-free and tax-deferred retirement plans.

Quote:

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Those expenses should then be spread equitably

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And therin lies the problem. "From each according to his ability, to each according to his need" comes to mind.

What's "equitable" to one is outright theft to another.

They are clearly more red than Texas and what Desantis has done is remarkable. He should be considered one of the greatest governors ever.

However, I simply think the power structures in Texas have a much higher hurdle to clear than what Desantis had in Florida. You hit on some of it with how power is allocated here vs there.

I just don't see how you get Dallas, Houston, Austin, San Antonio, El Paso, (and likely Ft Worth going forward) to not vote 60/40 - Dem/Rep...at best. I just read where the state is going to take over Ft. Worth ISD so that means they are officially lost to Democrats now.

Republicans have stopped even running for office in Dallas County because it's pointless. The only major win there in recent memory was the Mayor who switched parties after being in office for a while.

I always find this an interesting topic when it comes up. What is most interesting to me is the fervor over property taxes and the absence thereof over progressive income taxation.

My guess is because property taxes make up a tangible amount of a persons tax burden somewhat similar to their net income taxes burden coupled with it being a wealth tax. I never cared about property taxes because it is right at 1% for me. Almost anything it is replaced with will certainly shift the already overwhelming share of our total tax burden onto wealthier Texans.

I wish people would be so passionate about eliminating progressive income taxation.

I would gladly trade a permanently fixed 1% wealth tax for our current progressive income tax. I am over the hows and whys and just want my total tax burden south of 20%. And 15% would be ideal.

Quote:

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Consumption (sales) tax starts to break down at the county and city level because consumers are too mobile. It's fine in the larger urban counties but it will completely fail in the rural counties and the especially along the rural-urban interface counties.

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I have seen this living both in the Midwest and overseas in the Scandinavian region. There is always some sort of tax advantaged zone that undercuts the potential funding from sales tax.

In Chicago's case, the Indiana border was literally 15 milles from downtown where taxes on most everything were much lower.

The Swedes and Danes were famous for the duty free ferry rides where massive cartons of smokes and endless handles of vodka were purchased and carried home.

I love the model Florida is pursuing. You'll be hard pressed to exempt all property...so having Homestead being exempt, and others taxed is a very good tangible step.

I'd love to see something similar in Texas. Maybe a menial sales tax bump to compensate. At least with a sales tax, all use are paying for it equitably.

There is nothing I hate more, than a retired person continually paying for the privilege to live in their home, which has been paid off for years.

Quote:

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Almost anything it is replaced with will certainly shift the already overwhelming share of our total tax burden onto wealthier Texans.

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You are correct, sir.

Look at federal taxes - Trump's no tax on tips and no tax on overtime did exactly this. We keep removing people from having any skin in the game while increasing the burden on the producers.

This entire exercise is squeezing the balloon. We are not going to remove money from the current system without making it up somewhere else.

Even this proposed $40k home exemption increase the state has said they are going to makeup that cut revenue from somewhere else. Well, from where? And who will pay for that?

Aren't they talking about only eliminating non-school property taxes? I think the ISD taxes would remain.

Property taxes are genuinely evil.

AgGrad99 said:

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I love the model Florida is pursuing. You'll be hard pressed to exempt all property...so having Homestead being exempt, and others taxed is a very good tangible step.

I'd love to see something similar in Texas. Maybe a menial sales tax bump to compensate. At least with a sales tax, all use are paying for it equitably.

There is nothing I hate more, than a retired person continually paying for the privilege to live in their home, which has been paid off for years.

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Absolutely. Businesses and investment properties would continue to be taxed, absorbing the difference.

techno-ag said:

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AgGrad99 said:

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I love the model Florida is pursuing. You'll be hard pressed to exempt all property...so having Homestead being exempt, and others taxed is a very good tangible step.

I'd love to see something similar in Texas. Maybe a menial sales tax bump to compensate. At least with a sales tax, all use are paying for it equitably.

There is nothing I hate more, than a retired person continually paying for the privilege to live in their home, which has been paid off for years.

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Absolutely. Businesses and investment properties would continue to be taxed, absorbing the difference.

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So if businesses pay more taxes, that does not impact your salary?

Burdizzo said:

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one safe place said:

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Property taxes are a wealth tax and need to go.

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Weak argument

There are plenty of places to store wealth other than real estate where you don't have to pay tax on unrealized gains. My Berkshire Hathaway stock I bought in 2020 has almost tripled since then, and I have not paid a dime in taxes on it. Same with the XOM I bought back then, but I do pay tax on the dividend.

As a reminder, in most cases you don't have to pay capital gains taxes when you sell a homestead.

Not to mention countless other tax-free and tax-deferred retirement plans.

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Talk about a weak response.

Can you live in a share of Berkshire Hathaway? Yeah, I didn't think so.

Real estate taxes can be the largest expense for a retired person....and that expense only gets higher every year. And every year they have less in savings to pay it.

So your solution is to live homeless and buy stock instead?

javajaws said:

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Burdizzo said:

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one safe place said:

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Property taxes are a wealth tax and need to go.

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Weak argument

There are plenty of places to store wealth other than real estate where you don't have to pay tax on unrealized gains. My Berkshire Hathaway stock I bought in 2020 has almost tripled since then, and I have not paid a dime in taxes on it. Same with the XOM I bought back then, but I do pay tax on the dividend.

As a reminder, in most cases you don't have to pay capital gains taxes when you sell a homestead.

Not to mention countless other tax-free and tax-deferred retirement plans.

---

Talk about a weak response.

Can you live in a share of Berkshire Hathaway? Yeah, I didn't think so.

Real estate taxes can be the largest expense for a retired person....and that expense only gets higher every year. And every year they have less in savings to pay it.

So your solution is to live homeless and buy stock instead?

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Real estate taxes are frozen at 65. If their real estate taxes are their largest expense, they are not making much income and are probably already largely living off of entitlements.

javajaws said:

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Burdizzo said:

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one safe place said:

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Property taxes are a wealth tax and need to go.

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Weak argument

There are plenty of places to store wealth other than real estate where you don't have to pay tax on unrealized gains. My Berkshire Hathaway stock I bought in 2020 has almost tripled since then, and I have not paid a dime in taxes on it. Same with the XOM I bought back then, but I do pay tax on the dividend.

As a reminder, in most cases you don't have to pay capital gains taxes when you sell a homestead.

Not to mention countless other tax-free and tax-deferred retirement plans.

---

Talk about a weak response.

Can you live in a share of Berkshire Hathaway? Yeah, I didn't think so.

Real estate taxes can be the largest expense for a retired person....and that expense only gets higher every year. And every year they have less in savings to pay it.

So your solution is to live homeless and buy stock instead?

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You didn't read the previous argument. He complained that it was a tax on wealth. I told him there were better places to store wealth without a tax burden. He said nothing about old people not being able to live in a shelter

But you already knew that.

Tom Fox said:

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javajaws said:

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Burdizzo said:

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one safe place said:

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Property taxes are a wealth tax and need to go.

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Weak argument

There are plenty of places to store wealth other than real estate where you don't have to pay tax on unrealized gains. My Berkshire Hathaway stock I bought in 2020 has almost tripled since then, and I have not paid a dime in taxes on it. Same with the XOM I bought back then, but I do pay tax on the dividend.

As a reminder, in most cases you don't have to pay capital gains taxes when you sell a homestead.

Not to mention countless other tax-free and tax-deferred retirement plans.

---

Talk about a weak response.

Can you live in a share of Berkshire Hathaway? Yeah, I didn't think so.

Real estate taxes can be the largest expense for a retired person....and that expense only gets higher every year. And every year they have less in savings to pay it.

So your solution is to live homeless and buy stock instead?

---

Real estate taxes are frozen at 65. If their real estate taxes are their largest expense, they are not making much income and are probably already largely living off of entitlements.

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Someone posted yesterday that this is a little misleading. I can't speak to it though.

What I do know is that only the school portion is frozen which is typically about 50% of the total tax bill and then the base resets upwards, if you make improvements....supposedly.

I'll also point out the not very well known tactic that you can simply defer your property tax bill with an annual 8% penalty once you turn 65.

So, you can simply stop paying taxes and your estate will consume it at death. If you don't care about heirs having it or needing it, then that is an option.

YouBet said:

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They are clearly more red than Texas and what Desantis has done is remarkable. He should be considered one of the greatest governors ever.

However, I simply think the power structures in Texas have a much higher hurdle to clear than what Desantis had in Florida. You hit on some of it with how power is allocated here vs there.

I just don't see how you get Dallas, Houston, Austin, San Antonio, El Paso, (and likely Ft Worth going forward) to not vote 60/40 - Dem/Rep...at best. I just read where the state is going to take over Ft. Worth ISD so that means they are officially lost to Democrats now.

Republicans have stopped even running for office in Dallas County because it's pointless. The only major win there in recent memory was the Mayor who switched parties after being in office for a while.

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Only recently. Up until the 2016 election, Florida was always considered a battleground state (remember Bush/Gore?). The state went for Obama twice, and while the Governorship had been R for a while, DeSantis was elected in 2018 by a very thin margin.

northeastag said:

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YouBet said:

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They are clearly more red than Texas and what Desantis has done is remarkable. He should be considered one of the greatest governors ever.

However, I simply think the power structures in Texas have a much higher hurdle to clear than what Desantis had in Florida. You hit on some of it with how power is allocated here vs there.

I just don't see how you get Dallas, Houston, Austin, San Antonio, El Paso, (and likely Ft Worth going forward) to not vote 60/40 - Dem/Rep...at best. I just read where the state is going to take over Ft. Worth ISD so that means they are officially lost to Democrats now.

Republicans have stopped even running for office in Dallas County because it's pointless. The only major win there in recent memory was the Mayor who switched parties after being in office for a while.

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Only recently. Up until the 2016 election, Florida was always considered a battleground state (remember Bush/Gore?). The state went for Obama twice, and while the Governorship had been R for a while, DeSantis was elected in 2018 by a very thin margin.

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Yes, but they are the reddest state in the country at this point. It's frankly incredible.

YouBet said:

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Quote:

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Almost anything it is replaced with will certainly shift the already overwhelming share of our total tax burden onto wealthier Texans.

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You are correct, sir.

Look at federal taxes - Trump's no tax on tips and no tax on overtime did exactly this. We keep removing people from having any skin in the game while increasing the burden on the producers.

This entire exercise is squeezing the balloon. We are not going to remove money from the current system without making it up somewhere else.

Even this proposed $40k home exemption increase the state has said they are going to makeup that cut revenue from somewhere else. Well, from where? And who will pay for that?

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Interestingly regarding No Tax on Tips... Those folks are gonna get a rude shock next year when they don't get a refund in April. Most/many tipped workers are in an income tier where they are almost completely covered by standard deductions. They were getting their tip withholdings back on refund.

Overtime is capped at $12500.

Morbo the Annihilator said:

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Quote:

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Those expenses should then be spread equitably

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And therin lies the problem. "From each according to his ability, to each according to his need" comes to mind.

What's "equitable" to one is outright theft to another.

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I think I over thought the distinction between the two and used the wrong one.

Mia culpa. I don't like carve outs, and I don't want non-payers or over-payers of any age, demographic, or clarification (business/personal or family).

California was a republican stronghold in 1978 when they passed prop 13. Over time it had the effect of eliminating most property taxes in California, and also eliminating most republicans.

Quote:

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Real estate taxes are frozen at 65. If their real estate taxes are their largest expense, they are not making much income and are probably already largely living off of entitlements.

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If you're 70, with a paid off house, what would be a bigger expense? Property taxes are likely the largest expense for most people in that situation with a fixed/retirement income. I know a few people this is a giant burden for.

That 'entitlement' jab is disassociated from reality.

YouBet said:

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Tom Fox said:

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javajaws said:

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Burdizzo said:

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one safe place said:

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Property taxes are a wealth tax and need to go.

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Weak argument

There are plenty of places to store wealth other than real estate where you don't have to pay tax on unrealized gains. My Berkshire Hathaway stock I bought in 2020 has almost tripled since then, and I have not paid a dime in taxes on it. Same with the XOM I bought back then, but I do pay tax on the dividend.

As a reminder, in most cases you don't have to pay capital gains taxes when you sell a homestead.

Not to mention countless other tax-free and tax-deferred retirement plans.

---

Talk about a weak response.

Can you live in a share of Berkshire Hathaway? Yeah, I didn't think so.

Real estate taxes can be the largest expense for a retired person....and that expense only gets higher every year. And every year they have less in savings to pay it.

So your solution is to live homeless and buy stock instead?

---

Real estate taxes are frozen at 65. If their real estate taxes are their largest expense, they are not making much income and are probably already largely living off of entitlements.

---

Someone posted yesterday that this is a little misleading. I can't speak to it though.

What I do know is that only the school portion is frozen which is typically about 50% of the total tax bill and then the base resets upwards, if you make improvements....supposedly.

I'll also point out the not very well known tactic that you can simply defer your property tax bill with an annual 8% penalty once you turn 65.

So, you can simply stop paying taxes and your estate will consume it at death. If you don't care about heirs having it or needing it, then that is an option.

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I just looked. As of 2024 the median property taxes bill in Texas was $4100. This is what we are up in arms about? I'd be interested what peoples net income tax bill comes out o if this is what has them spun up.

dumb idea. this means super rich can build a $50 mil house and keep it off the tax rolls for as long as they live.

there are so many resultant bad repurcussions that it makes no sense.

just give up to $500K in homestead exemptions...something like Texas already does.

Morbo the Annihilator said:

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Quote:

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Those expenses should then be spread equitably

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And therin lies the problem. "From each according to his ability, to each according to his need" comes to mind.

What's "equitable" to one is outright theft to another.

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I think you misunderstand.

Sales tax exempts no one. We all share the burden, and we all pay the same. That's the opposite of what came to mind for you.

All tax is theft. But we're discussing the reality of them being imposed.

I do not support this plan. I do, however, support eliminating property taxes completely and replacing them with a sales tax

AgGrad99 said:

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Quote:

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Real estate taxes are frozen at 65. If their real estate taxes are their largest expense, they are not making much income and are probably already largely living off of entitlements.

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If you're 70, with a paid off house, what would be a bigger expense? Property taxes are likely the largest expense for most people in that situation with a fixed/retirement income. I know a few people this is a giant burden for.

That 'entitlement' jab is disassociated from reality.

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If the median property tax bill in Texas is $4100 and if that is higher than their annual income tax burden, then they are largely living off of social security, aka entitlements. How little do you have to make for your income taxes to be < $4100 annually?

Bunk Moreland said:

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I do not support this plan. I do, however, support eliminating property taxes completely and replacing them with a sales tax

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What sales tax rate?

Yeah, I think we need to remember this board is an outlier on the wealth spectrum. I wish my prop tax bill was only $4,100.

I think we can't forget insurances and improvements though. When I look at our housing costs, I always bundle property taxes + insurances + improvements. Those 3 together are 20% of our total annual spend. Now, we spend way more on food and likely vacations than most people.

If our food and vacation bill was more in line with the average, I'm betting our annual Home spend would be somewhere around 30% of our total spend.

AgGrad99 said:

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Morbo the Annihilator said:

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Quote:

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Those expenses should then be spread equitably

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And therin lies the problem. "From each according to his ability, to each according to his need" comes to mind.

What's "equitable" to one is outright theft to another.

---

I think you misunderstand.

Sales tax exempts no one. We all share the burden, and we all pay the same. That's the opposite of what came to mind for you.

All tax is theft. But we're discussing the reality of them being imposed.

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Not completely true. We already exempt unprepared food and agricultural products from sales tax. Sales tax is also difficult to collect on cash transactions that go unreported to the state comptroller. If we shift the burden to a sales tax, look for the cash economy to explode.

You know who does a lot of cash business to fly under the radar? Illegal aliens. In contrast to property tax, if an illegal alien comes here and rents a shack in a colonial, his slumlord still has to factor in property taxes on the rent he collects.

Tom Fox said:

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YouBet said:

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Tom Fox said:

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javajaws said:

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Burdizzo said:

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one safe place said:

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Property taxes are a wealth tax and need to go.

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Weak argument

There are plenty of places to store wealth other than real estate where you don't have to pay tax on unrealized gains. My Berkshire Hathaway stock I bought in 2020 has almost tripled since then, and I have not paid a dime in taxes on it. Same with the XOM I bought back then, but I do pay tax on the dividend.

As a reminder, in most cases you don't have to pay capital gains taxes when you sell a homestead.

Not to mention countless other tax-free and tax-deferred retirement plans.

---

Talk about a weak response.

Can you live in a share of Berkshire Hathaway? Yeah, I didn't think so.

Real estate taxes can be the largest expense for a retired person....and that expense only gets higher every year. And every year they have less in savings to pay it.

So your solution is to live homeless and buy stock instead?

---

Real estate taxes are frozen at 65. If their real estate taxes are their largest expense, they are not making much income and are probably already largely living off of entitlements.

---

Someone posted yesterday that this is a little misleading. I can't speak to it though.

What I do know is that only the school portion is frozen which is typically about 50% of the total tax bill and then the base resets upwards, if you make improvements....supposedly.

I'll also point out the not very well known tactic that you can simply defer your property tax bill with an annual 8% penalty once you turn 65.

So, you can simply stop paying taxes and your estate will consume it at death. If you don't care about heirs having it or needing it, then that is an option.

---

I just looked. As of 2024 the median property taxes bill in Texas was $4100. This is what we are up in arms about? I'd be interested what peoples net income tax bill comes out o if this is what has them spun up.

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Property, liability, and auto insurance dwarfs my property tax burden. I wish our state legislators would fix that burden.

YouBet said:

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Yeah, I think we need to remember this board is an outlier on the wealth spectrum. I wish my prop tax bill was only $4,100.

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The median amount takes into account vacant unimproved property in the middle of west texas. It's not inclusive of improved homestead properties...much less any house in an incorporated city...where the majority of residents live. It's just an outlier number, that has little to do with the conversation.

But even with that number, not a lot of retired 75 year olds, on a fixed income have fixed expenses every month over $400. Most have cars paid off, a house paid off, etc. It's still one of the biggest expenses most have.

Pretending as if thousands of dollars in property taxes aren't a giant burden is silly. And even if you think it's not a burden, the morality of charging someone annually for the right to live in their house is asinine to me. Always has been.