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Next week, Oklahoma voters will be asked to vote on widening the tax base for intangible property.  Right now, we pay taxes on some intangible properties - cash on hand, bank drafts, certified checks, stocks, bonds, property we should own but may not.

That last one is the one that bites me every year. I'm not paying taxes on what I actually own inside my home, I'm paying taxes on what the state thinks I should own inside my home on the premise that I buy new furniture every 5 years.  I am taxed on the value of that new furniture that I haven't bought and don't own. It's called an ad valorem tax.

And one of the things the Legislature is contemplating is widening a 1968 state tax law on intangible property – they want to include lease agreements, insurance policies, unused mineral rights (they already tax used mineral rights), computer software, databases, customer lists, customer relationships, copyrights, patents, educational degrees (including  kindergarten and high school diplomas!), ideas, services, good will (I’m not sure how they will determine the cheerfulness level of “Good morning!” in order to tax it, but that was one of the samples they gave, along with the “good will” generated by McDonald’s Golden Arches), advertising, technical documentation, essays, poetry, trade names and trade marks, email, volunteer work, and workforce goodwill.

I’m sure if they could find a way to include one’s private thoughts and personal conversations, they would!

I already pay an ad valorem tax on property I don’t own, and now I’m going to have to pay a tax on attitudes and good will?

It boggles my mind.

I think, if this keeps up, when I retire, I am leaving Oklahoma.  Don’t know where, yet, but I don’t think I want to live in a state that taxes good will.

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Comment Preferences

  •  Tip Jar (9+ / 0-)

    All knowledge is worth having. Check out OctopodiCon for steampunk learning and fun. Also, on DKos, check out the Itzl Alert Network.

    by Noddy on Wed Aug 22, 2012 at 08:18:45 AM PDT

  •  The Intangible tax in a nutshell... (5+ / 0-)

    You have money. Give it to us.

  •  This is the first time I have heard of Intangible (3+ / 0-)
    Recommended by:
    weck, FloridaSNMOM, chimene

    Taxes and I have filed taxes in 4 states (VA, MI, CO, AL). Do other states have these taxes?

    I voted with my feet. Good Bye and Good Luck America!!

    by shann on Wed Aug 22, 2012 at 08:37:16 AM PDT

  •  Noddy - taxes of this kind are common (6+ / 0-)

    in some states for businesses, but this is the first I have read about them for individuals. I think taxing intangibles, where accurate valuations are problematic, is an enforcement nightmare.

    "let's talk about that"

    by VClib on Wed Aug 22, 2012 at 08:42:06 AM PDT

  •  i don't see how it's possible (4+ / 0-)
    Recommended by:
    GreenMother, MKSinSA, weck, chimene

    for them to tax you on furniture they think you own.  that is just wack as all get out.  do you have a link?

    anyhoo, it looks like there is another ballot measure in the works to exempt all intangible property from taxation.

    Mitt Romney seems congenitally incapable of inspiring people - Richard Wolfe, 8/15/2012

    by Cedwyn on Wed Aug 22, 2012 at 08:54:00 AM PDT

    •  it also looks like (3+ / 0-)
      Recommended by:
      johnny wurster, MKSinSA, weck

      your state constitution currently already exempts cash and the things listed in your opening paragraph:

      https://www.sos.ok.gov/...

      the other ballot measure looks like it lowers the caps on tax increases.

      Mitt Romney seems congenitally incapable of inspiring people - Richard Wolfe, 8/15/2012

      by Cedwyn on Wed Aug 22, 2012 at 08:58:38 AM PDT

      [ Parent ]

      •  I think the diarist is confusing "ad valorem" (0+ / 0-)

        taxes - which are just property taxes - with the valuation procedure, which in OK appears to be based on "highest best use" (anyone familiar w/ accounting should recognize this term immejiately).  I'm guessing that that methodology assumes that the homeowner isn't using milk crates in the house, but rather makes improvements from time to time.  

        I'm not sure that that's exactly right, it's just an educated guess.

        •  We have a separate property tax (1+ / 0-)
          Recommended by:
          FloridaSNMOM

          and then the ad valorem tax on top of that for the furnishings inside the home - when you buy property, one of the things that happens is that you are told all the new taxes you are now liable for.

          I paid $1,005.29 in property taxes last November, and then I paid $497.01 in ad valorem taxes in February for the furnishings of my property.  This November, I will be paying $1.102.18 in property taxes and in February, $516.03 in ad valorem taxes.

          It is presumed that I have suitable new furnishings and replace them approximately every 5 years. It also presumes I have state-of-the-art plumbing, wiring, and central heat and air and I am taxed as if that were true - even though the city, county, and state know otherwise. I had them inspect the house to prove it wasn't so.  I still have to pay taxes for things I don't own. It also presumes I have a dishwasher, washing machine, clothes dryer, a 18 cf refrigerator or larger, 5 televisions, cable TV service, a landline, and 3 desktop computers with high speed internet service for all three. I know because that's the "standard" for a house the size of mine.

          Ad valorem taxes are not "just property taxes".

          I am not confused.  I know exactly what taxes I pay, how much I pay, and what those taxes are presumably for.

          All knowledge is worth having. Check out OctopodiCon for steampunk learning and fun. Also, on DKos, check out the Itzl Alert Network.

          by Noddy on Wed Aug 22, 2012 at 10:12:23 AM PDT

          [ Parent ]

          •  you are kinda confused (0+ / 0-)
            Right now, we pay taxes on some intangible properties - cash on hand, bank drafts, certified checks, stocks, bonds, property we should own but may not.
            your state constitution already exempts those things:

            https://www.sos.ok.gov/...

            Mitt Romney seems congenitally incapable of inspiring people - Richard Wolfe, 8/15/2012

            by Cedwyn on Wed Aug 22, 2012 at 10:17:10 AM PDT

            [ Parent ]

            •  Fine. (0+ / 0-)

              You can believe you know better than I do what taxes I pay.

              All knowledge is worth having. Check out OctopodiCon for steampunk learning and fun. Also, on DKos, check out the Itzl Alert Network.

              by Noddy on Wed Aug 22, 2012 at 10:21:07 AM PDT

              [ Parent ]

              •  did you read that link? (1+ / 0-)
                Recommended by:
                johnny wurster

                the constititon currently reads:

                Section X-6Av2: Intangible personal property exempt from ad valorem or other tax.

                    Intangible personal property as below defined shall not be
                subject to ad volorem tax
                or to any other tax in lieu of ad valorem tax within this State:
                    (a)  Money and cash on hand, including currency, gold, silver,
                and other coin, bank drafts, certified checks, and cashier's checks.
                    (b)  Money on deposit in any bank, trust company, or other
                depository of money, within or without the State of Oklahoma,
                including certificates of deposit.

                lots of other stuff is listed.  the proposed ballot measure would eliminate the listings and just blanket exempt such items:
                This measure would exempt all intangible personal property from ad valorem property taxation.

                Mitt Romney seems congenitally incapable of inspiring people - Richard Wolfe, 8/15/2012

                by Cedwyn on Wed Aug 22, 2012 at 10:29:35 AM PDT

                [ Parent ]

      •  There's a line of my state tax form (0+ / 0-)

        that asks for "cash on hand" and I can choose to either declare exactly how much cash I have or take a "lump sum" that they presume a person of my income level would have and tax that.  I pay taxes on the stocks I own. I pay a tax when I draw a certified check.  That's not exactly "exempt".

        I know what taxes I pay.  I pay attention to that because I don't earn very much.  When all my taxes are added up, I pay approximately 35-40% of my income on taxes.  That's Federal income taxes, state income taxes, additional state taxes, county taxes, city taxes, ward taxes, and sales taxes.

        All knowledge is worth having. Check out OctopodiCon for steampunk learning and fun. Also, on DKos, check out the Itzl Alert Network.

        by Noddy on Wed Aug 22, 2012 at 10:19:42 AM PDT

        [ Parent ]

        •  so how does that square with the language (0+ / 0-)

          in the state constitution?  if it isn't an ad valorem tax, what is it called on the tax forms?

          this just makes zero sense; wouldn't cash on hand derive from income on which you already paid taxes?  

          i'm equally mystified at the idea that they can tax you for things they think you own.  i'm really wanting to understand this, so if you do have a link for that, i would appreciate it.  

          sorry for saying you were confused, but if the constitution prohibits ad valorems on those things, but you are paying them, there's a massive problem.  i'm just trying to understand how that's possible.

          Mitt Romney seems congenitally incapable of inspiring people - Richard Wolfe, 8/15/2012

          by Cedwyn on Wed Aug 22, 2012 at 10:42:15 AM PDT

          [ Parent ]

          •  We also pay taxes (0+ / 0-)

            on any Federal tax refund we receive.

            It doesn't have to make sense, in Oklahoma.

            All knowledge is worth having. Check out OctopodiCon for steampunk learning and fun. Also, on DKos, check out the Itzl Alert Network.

            by Noddy on Wed Aug 22, 2012 at 11:26:58 AM PDT

            [ Parent ]

            •  it has to make enough sense (0+ / 0-)

              to not violate the state constitution.  that's just wack.  is it a federal/state tax issue?

              do you have a link about the furniture?  that one is particularly mindblowing.

              Mitt Romney seems congenitally incapable of inspiring people - Richard Wolfe, 8/15/2012

              by Cedwyn on Wed Aug 22, 2012 at 12:27:18 PM PDT

              [ Parent ]

              •  Nope, it doesn't. (0+ / 0-)

                It only has to make sense at the time the politicians are touting it  It doesn't have to have any kind of consistency with anything else, just has to convince enough voters that it's a Good Idea.

                I don't have a link about the furniture because I've never looked it up - I don't have to.  I have the papers in with my property deed and I receive the tax bill every year.  That's all I ever needed.

                All knowledge is worth having. Check out OctopodiCon for steampunk learning and fun. Also, on DKos, check out the Itzl Alert Network.

                by Noddy on Wed Aug 22, 2012 at 02:28:05 PM PDT

                [ Parent ]

                •  Try appealing the tax bill. (0+ / 0-)

                  You may find you've been  paying taxes you didn't owe.

                  "Two things are infinite: the universe and human stupidity, and I am not sure about the universe." -- Albert Einstein

                  by Neuroptimalian on Wed Aug 22, 2012 at 07:06:54 PM PDT

                  [ Parent ]

                  •  Done that (0+ / 0-)

                    I am not paying taxes I don't owe.  As a homeowner, though, I have a lot of different taxes renters don't get. If the legislature and voters really do eliminate the state income tax, I will be paying even more taxes.  I'm betting this is why they are wanting to renew and reinforce the intangibles tax.

                    All knowledge is worth having. Check out OctopodiCon for steampunk learning and fun. Also, on DKos, check out the Itzl Alert Network.

                    by Noddy on Thu Aug 23, 2012 at 09:38:56 AM PDT

                    [ Parent ]

  •  This is how they will tax the marginal people (0+ / 0-)

    out of property ownership and home ownership, creating a new underclass of underlings while simultaneously satisfying the desires of the teahumpers who think that income tax is bad, but intangible taxes are good.

  •  PA is nice if you like hills and trees. :) n/t (1+ / 0-)
    Recommended by:
    Noddy

    “In the Soviet Union, capitalism triumphed over communism. In this country, capitalism triumphed over democracy.” - Fran Lebowitz

    by Aramis Wyler on Thu Aug 23, 2012 at 10:40:17 AM PDT

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