Skip to main content

View Diary: BREAKING: Another GOP scandal brings CA 52nd into play (271 comments)

Comment Preferences

  •  Actually, he may not be guilty of anything (1+ / 0-)
    Recommended by:
    Christopher Walker

    The way property taxes are determined in California is based on purchase price, and on improvements to the property. The assessments exist to establish a cap on how high the property taxes can increase (2%/year, iirc) and to also allow the tax to be adjusted downwards if the price drops below purchase price. If he's paying taxes on a base value of the purchase price+construction price, then there's probably nothing strictly illegal about his property tax bill.

    The big problem is the sacred cow of California, the prop 13 fuck-up which has shifted the property tax burden from businesses to individuals in the name of tax cuts, while simultaneously making it damn near impossible for government to raise the taxes that it needs to do its job.

    •  Great Comment but (3+ / 0-)
      Recommended by:
      cityduck, lorzie, ca democrat

      what if the value paid was from a sweetheart deal that grossly undervalued the property.  Is there an exception for unconscionably low values?

      Imagine, if I sold you a $10 million dollar house for $500,000 on paper but gave you the other $9.5 million, as a side deal.  Would there be no way to examine that?

      What do the assessors do if the tax is based upon the sale only?  What would they have to be bribed for and what exactly do they examine?

      •  That is no doubt a loophole (0+ / 0-)

        You would hope that there's some means to deal with what you're talking about, but I would guess that it's relatively unlikely to happen since the seller would take a pretty big tax hit in the case that you've described since they would face a 9.5million of regular income (which would be taxed at a marginal rate of over 50% between fed and state taxes). The likely capital loss on the sale of the house, meanwhile would not be a deductible event. For a straight sale below market value, though, there's no real safeguard in place as far as I'm aware. After all, the value of any good is precisely what someone is willing to pay for it (or sell it for). Not to mention that there are plenty of legitimate below-market sales that take place as well (e.g., sales of old church properties to non profits for nominal sums of money, usually a dollar, or the sale of residential properties owned by the state for below market rates as dictated by state law).

      •  yes they can review the bldg to see (0+ / 0-)

        and change the value, happens more often on commercial property sales

        How do you know a Republican is lying? Ask one: If the Republicans can lower gas prices for 60 days before an election, why won't they do it all the time?

        by ca democrat on Mon Oct 09, 2006 at 08:50:12 AM PDT

        [ Parent ]

Subscribe or Donate to support Daily Kos.

Click here for the mobile view of the site