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New York passes pied-a-terre tax

cnbc.com

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Re: New York passes pied-a-terre tax

#331

Post by gorgoiler »

apparent wrote: post #325
gorgoiler wrote: post #307

Earlier quoted context omitted.

What if the city lets you declare your chosen value without being able to force you to sell, but if you ever sell at a higher value then you owe back-taxes on the difference? And if the difference is more than X% then it’s fraud unless you can persuade a judge otherwise. The loophole might be that Billionscorp LLC is listed as the property owner, and Jeff Billions technically only rents the penthouse from his own com…

You'd just end up arguing about when the property appreciated. The owner would say it all happened since the last tax payment was due. It would also complicate the home buying negotiation. People would look at your recent tax payments and put a cap on the bids they would make based on what would trigger back taxes for you.

I was indeed assuming that if you declared a value of $X but then sold N years later for $Y, then you pay N*(Y-X) in taxes.

You are right to imply that it seems unfair if you discover in year 49 of your happy 50 year tenure that your Queens bungalow was built on top of a seam of pure gold nuggets all along.

Re: New York passes pied-a-terre tax

#332

Post by selfhoster1312 »

Aurornis wrote: post #95
burlesona wrote: post #22

Property tax is the workable wealth tax. There's no such thing as a perfect policy, but in the context of NYC this seems worth trying. I'll be interested to see if it helps create some liquidity in the housing market (the goal), or if it only functions as revenue source. One wrinkle I haven't heard much discussion of -- cities respond to incentives too. NYC is a global destination for the mega wealthy. If it turns ou…

> If it turns out the uber-rich don't mind paying and this becomes a cash cow for the city, that creates incentives for the city to cater to them and try and get more uber-rich people to have second homes in the city. The tax is reasonably small enough that I wouldn't expect a lot of wealthy people from divesting from their properties, but it's probably going to make them think twice about buying new properties. That…

> France discovered this the hard way when they implemented their first wealth tax

Citation needed (for a solid study, not right-wing propaganda from CNews/Libération). From a quick cursory look, it appears the French government had no problem raising taxes when the taxes were higher, and that the previous governments who reduced taxes for the rich setting blame on public debt have in fact increased public debt over and over. (disclaimer: i'm not an economist)

Re: New York passes pied-a-terre tax

#333

Post by BrenBarn »

retired wrote: post #304
onlyrealcuzzo wrote: post #7

I think this is in the right direction, but the cut off at $1M is interesting. Why's there an obsession with the $1m cutoff? The dollar has been turned to dust. $1M is not that much money, especially in housing, especially in NYC. Why tax $1m second homes and not second homes generally? Effectively, you're going to tax almost all second homes. So why the arbitrary cutoff? Chicago wanted to add a "millionaire's tax" o…

The Netherlands has a 2.2% tax on secondary properties with a €50k threshold (total wealth, not per-property). So any holiday home, shed, storage locker, garage space, parking spot, bungalow, pied-a-terre, apartment for your children falls under that tax. It's.... problematic to say the least. Say you bought a bungalow for €30k in the 2000s that you frequently visit to escape the city. You are a middle class worker,…

That sounds like it would be pretty reasonable if the threshold were higher.

Re: New York passes pied-a-terre tax

#334

Post by ethbr1 »

dirtikiti wrote: post #293
nkohari wrote: post #257

Earlier quoted context omitted.

Can you explain how that would happen? This tax is limited to second homes only.

this is literally a cover to overhaul the property tax assessment system in New York. https://www.msn.com/en-us/money/companies/new-york-passes-ma... "While the tax seems large, experts say the city's antiquated assessment and valuation system dramatically undervalues properties, reducing the burden. City valuations can often be 10% or less of the true market value, they said. Rather than overhaul the system immediat…

>> City valuations can often be 10% or less of the true market value

> this is, at minimum, a 10% increase in ALL property taxes

If they're ~10x'ing the erroneously low valuation to true them to market value, then that would be more than a 10% increase.

>> Since valuations will skyrocket, the tax rates will fall to compensate

But as the article points out, this is an expected outcome and will be blunted by subsequent tax rate decreases.

All things equal, undervaluing properties for tax purposes isn't fair, although it may be politically (corruptly) popular.

Re: New York passes pied-a-terre tax

#335

Post by selfhoster1312 »

Galanwe wrote: post #322
ExoticPearTree wrote: post #269

Earlier quoted context omitted.

> It is great to want to give your kids a head start in the world, it is terrible for them and the people around them to set them up for life. How is it terrible for my kids to not have to break their back like I did to build the wealth I'm looking to pass on to them after I die? Why should they go through the same struggles that I did? It is up to them to squander it or transform it into even more wealth to pass it…

Inheritance tax in practice is implemented above a certain threshold. There is nothing wrong with striving to give a heads up in life to your kids, on the contrary, it's a core, visceral instinct of parents to do so, and removing that would be alienating. There is a certain level of wealth though, where the "heads up" transforms to an unstoppable compounding lever. France for instance has a progressive inheritance ta…

Unless i've misunderstood the text, the Zucman tax proposed a minimum 2% tax rate for the >100M€ rich bastards who don't already pay 2% of their income in taxes, not an additional 2% on top of existing taxes.

Re: New York passes pied-a-terre tax

#336

Post by selfhoster1312 »

SoftTalker wrote: post #135
arw0n wrote: post #110

Earlier quoted context omitted.

The fairest and easiest to realize wealth tax is on inheritance. It is great to want to give your kids a headstart in the world, it is terrible for them and the people around them to set them up for life.

I would disagree, I think income taxes and inheritance taxes are morally wrong. Earning money to support oneself and family instead of relying on public largesse should not be taxed. Passing the fruits of a lifetime of work to ones heirs so they can continue do productive work instead of relying on public largesse should not be taxed.

I would disagree. How else would you pay for the schools, roads and hospitals so that you and your heirs can "do productive work"? I mean i could imagine alternatives, but none that's compatible with a capitalist system.

Re: New York passes pied-a-terre tax

#338

Post by huhkerrf »

wat10000 wrote: post #311
bdangubic wrote: post #291

Earlier quoted context omitted.

We already do that. - Bob Menendez (Senator) - Randy Cunningham (Congressman) - William J. Jefferson (Congressman) - James Traficant (Congressman) And a bunch more at more "local" level...

Anything recent? The practice seems to have fallen off in recent years.

My dude, Menendez was imprisoned in 2025...

Re: New York passes pied-a-terre tax

#339

Post by selfhoster1312 »

bdangubic wrote: post #291
wat10000 wrote: post #283

Earlier quoted context omitted.

I'm sure it can't be removed entirely, but we could, for example, start imprisoning people who give or accept bribes.

We already do that. - Bob Menendez (Senator) - Randy Cunningham (Congressman) - William J. Jefferson (Congressman) - James Traficant (Congressman) And a bunch more at more "local" level...

If we already did that, half of governemnt members across the globe would be in prison. And as much as i would enjoy to see all french politicians rot in jail, i don't think that's happening anytime soon.

Re: New York passes pied-a-terre tax

#340

Post by tantalor »

nonethewiser wrote: post #184
tantalor wrote: post #176

Earlier quoted context omitted.

For the tax authority (and the public) it's a win/win: 1. Property is taxed at correct rate (win) 2. City buys property at low cost (win)

Thats not the scenario I detailed. Read it again.

Your scenario would not happen. It's not one of the "win" cases, as I explained. What would be the point?
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