Saturday, April 21, 2007

Florida Property Tax Update - How the Retiree Community may get helped and hurt Shuffleboard tourneyFlorida has long had a reputation for Shuffleboard and the Early Bird Special to contrast the month of March when the state is riddled with High School and College Co-ed Debauchery, namely Spring Break.

The State has grown up a lot in the past 50 odd years though... and growing pains have left us where we are now - in the middle of a huge tax dilemma.

One demographic that has been brought to the forefront of this debate is that retirement community that the State may be neglecting in their planning as thus far nothing in the news has touched on how they will benefit directly.

Sure, they'll get a tax break with possible double homestead exemptions and rolling back taxes to their assessed levels of 4-5 years ago... but some of these people have been in their houses for 20+ years and the caps on their taxes have certainly been broken a few times...

Think about it... if you get a 3% maximum increase yearly over 20 years, you're talking some major compounding!

Del Boca Vista TeeSo now with Grandma and Grandpa as Art Blanchet and Bill Quigley refer to them well past the days when their pensions ran out and living on a VERY fixed income are watching their taxes go up and their crown molding fall down... how do they deal with the idea of higher taxes on their everyday shopping AND the fact that maybe their kids who are about to retire may not be in a place to join them in Del Boca Vista (Seinfeld-ism)?

The fact is... they ARE paying more than their fair share right now. They are not making an active income yet they are getting taxed on their properties in lieu of income tax.

Then with the measure to raise sales tax, their cost of living will be somewhat contained but their fixed income is still getting taxed despite the fact that it isn't taxed directly.

Many Florida homeowners simply have it easy. WHAT?!? Blasphemy!

NO... listen up... Florida has no State Income Tax so many people come here because Property Taxes are much lower than they'd pay if they stayed in their home-state or even home-country! I said it! YOU HEARD IT! Millionaires and Foreign Investors!

amex blackFor instance... American Express was the subject of a news story specifically regarding the Centurion Card. No...99% of the people in the world have NO clue what I'm talking about. Some people have heard of it but think it is an urban myth... I know it exists. Why? Because I've held them in my hand. Yes - I've touched several REAL Black Amex Cards. There are only 1500 in the world... why do I bring them up? The highest concentration of Black Amex Holders in the world live in Palm Beach County, Florida.

What in the world does that have to do with nothing whatsoever?

well... Grandma and Grandpa live in a $125,000 condo that they paid $30,000 for 20 years ago. They're paying $2500 in Income cum Property Taxes to live there...

But... Millionaires with great credit - because that's what you have to be to get an invitation to apply for a Black AMEX after 5 years of spending $5-10K minimum PER MONTH on a Platinum AMEX - don't pay income tax on their passive and active incomes. And they live in $12.5Million Condos on the Beach... 100 times the pricetag but making FAR more than 100 times the income in MANY instances.

Oh... that's just a drop in the bucket sayeth Lawmakers.... yeah... they're right... THEIR BUCKETS.

(Ironically while this is up for debate, Former Congressman Mark Foley is paying for his defense with the millions of dollars in leftover campaign monies... why aren't those going back into the state since he's NOT campaigning?!)

Let's say ONE Black Amex holder at $5000/mo spending has to pay 2% more sales tax... Write it on paper with me people!... yes... that's $100 more per month. Oh... yeah.. .they'll feel that.... but $100/month times 12 for a year is $1200/year or Half of What Grandma and Grandpa pay in taxes! Oh yeah... and the IRS lets you deduct State Sales Tax if your State has no Income Tax!!

These people are SPENDING more in two weeks than Grandma and Grandpa are being Taxed!

So it is boiling down again to the Haves vs the Have Nots.

Grandma and Grandpa HAVE NOT so they're Taxed in their Retirement...

The HAVES are still going to get tax breaks regardless... and the net effect of their increased spending being taxed will really not amount to much at all.

So why go that route?

robin hood disneyBecause there is no State Income Tax to identify where monies are really coming from.... what?!

The Millionaire demographic is harder to identify than Grandma AT THE STATE LEVEL.

No... I'm not pretending to be Robin Hood... I don't wear tights. What I'm saying is that the issue isn't property tax, nor is it sales tax....

it isn't about EQUAL treatment of all citizens... it is about EQUITABLE treatment...something far different and far harder to create except in Utopia... an island off of Never Never Land.

That's where lawmakers just can't seem to dig in this... how do you identify taxpayers that should be paying more or less?

Income Tax

Believe me... I don't want to pay it either... but it is definitely a place where a RETIREE EXEMPTION Could be enforced!

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