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Visitor

I have a property tax question.

We have farmed for 56 years, i've also worked in town 48 of those years and my wife has done the same.  We've always invested as much as we could into farming and buying farm land for our retirement.  Now our school system wants to raise the school tax $2.70 per thousand taxable valuation.  I started looking a little harder at the property taxes.  Why do I have to pay property tax on my retirement, while the people living in towns/cities or acreages invested their money in retirement programs(example 401K) don't?  Maybe the tax laws should be changed so property taxes are not paid on farm land (only the residence portion) or treat all retirement programs(example 401K) as property. 

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Honored Advisor

Re: I have a property tax question.

Yeah and if you`ll look over 50-60% of the farmland tax goes to fund schools.  I hate to be harsh, but what kind of school that`s in the district has nothing to do the yields your farm raises.  School funding should come from state income taxes, because the argument could be made that everyone had or has the bennefit of public education, even if it`s through their own kids or better educated employees that they hire.  There isn`t even much local control of schools anymore, if there`s a bad teacher that needs fired, its like pulling teeth and the feds think we need "common core" curriculum.  But throwing that big of load on property tax makes no sense, plus we fund the roads disproportionally plus contribute the land for the road and ditches.  

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Senior Advisor

Re: I have a property tax question.

BA  -  Funding  roads disproportionally  - can you explane that one please ?  

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Honored Advisor

Re: I have a property tax question.

Hey K-289, states are different and counties are run differently so it`s hard to get a good comparison.  Iowa is actually pretty good because Governor Branstad in his first stint as governor put limits on how much property can be soaked in taxes.  But farmers pay alot of property tax and maybe 25% or so goes into the general fund and the rural basic that gets raided ...because that`s where the money is.

 

I don`t have any illusions of that changing because "that`s the way it`s always been done" and everyone has made their nests.  But farmers do carry more that their fair share.  Alot of these roads you rarely see a actual farmer driving on them, it`s people on acreages going to and from work.   Oh I know "the semis are 90,000 lbs in the fall!" but that`s just a small part of it, many roads don`t see a semi 11 months out of the year.

 

The semis are actually soaked on the license and registration and each time any vehicle is sold it gets soaked the 5% or 7% sales tax from when it`s new to the last time it`s sold to be used.  but that`s all road use mostly legitimate taxes.  The fairest is the fuel tax, it puts the tax directly on vehicle that using the road.  And thank God we in Iowa raised the fuel tax a dime or farmers would`ve gotten soaked more in addition to all the other tax and fees. 

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Veteran Advisor

Re: I have a property tax question.

Semis and trailers also pay a federal excise tax when purchased new, besides the sales taxes that get paid over and over.

 

The fairest way to fund the schools is through a household income assessment, including retirement income. Even include the earnings on the 401K's.

 

That way, the next time a school district wants to build a new building, everyone has a proportionate stake in the outcome and gets to contribute proportionately in paying for it, too.

 

Iowa seems to be the place to retire...if not one of the Dakotas. No tax on SS, and generous pension exclusion, too, and enhanced medical deductions.

 

I can see why farmers near the border are swapping land and getting rid of their MN properties. Maybe Iowa is that Paraquay that doornob talks about. lol.

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Honored Advisor

Re: I have a property tax question.

That new school up in Wells really jacked property taxes that were already at nose bleed levels in Minnesota.  The heck of it is over at Brownsdale they had signs up "Save our School!" well, they voted to close it anyway, I don`t know what Wells was thinking and that`s a 20 year millstone around their necks.  And that may stiffle people from moving to a community..."oh yah beautiful school, but I don`t wanna pay for it".  Like those California cities that went bankrupt because of the overly generous retirement packages for their city employees, you`d have to be nuts in the head to move to some of those places.

 

At my public school Alma Mater, they took on "free money" to build safe rooms and new gyms and such..well that all requires heating and upkeep. school enrollment is going down, I graduated with over 150 (in the stone age) and now it`s barely 100 in a class.  The superintendent is between a rock and a hard place, he wanted more property taxes to bail him out...but goll dang it that "free money" ain`t free.  So, he has to make tough decisions, teachers are given early retirement and not replaced, all the teachers there are very young now.  Well heck, with this Ipers or whatever they call it a teacher might collect over $1 million in retirement and that`s another can of worms.

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Senior Advisor

Re: I have a property tax question.

I'm well aware of Federal Hwy use  - etc. and the fuel , mileage agreements having a Class 8 transportation business for 3 + decades ---

 

The  ag industry has recieved  '' several exemptions '' not available to the commercial carriers that are certainly questionable to commercial carrier industry ---

 

Hauling  90,000 + + as witnessed in our area is jeaprodizing bridges , culverts and road structures and the general public is starting to take notice when these issue become expenditures at Town Ship meetings --- Grain Carts , Manure wagons are causing issues wether we admit it or refuse to --- 

 

The Norfolk Nebraska area witnessed on TV News of a DOT Enforcement Carrier Officer littrally hopping on the running board of a grain truck & trailer that was traveling down US 81 - 4 lane - weaving and going @ 10 mph in a 55 zone - after stopping the vehicle with the driver slumping over the steering wheel --- Luckly no physical incident to other traffic except the driver was having a health reaction although being a farm ag carrier is EXEMPT from having a DOT PHYSICAL HEALTH card which made some interesting headlines - just saying the EXEMPTION could soon be a 2 headed varment ---

 

'' Red  fuel '' in over the road vehicles is a whole other topic in which the  '' hired  man ''  didn't know and must have got the wrong hose ---       

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Honored Advisor

Re: I have a property tax question.

Our NC county's school board and commissioners were locked in a sort of impasse over funding a new high school.  It has been a harangue for a decade or so, but the courts tfinally orderd mediation, I think, and the outcome wasa referendum on the last election date, in March.  We were asked to approve a roughly ten [percent increase in ad valorem taxes.  They have already stifled business, adn between taxes adn our REA rates, houses are going empty or a routine basis...I call this a Death Spiral...fewer and fewer to carry off the costs of the system as a whole.  The weaker get pushed out, piling more on the remainders. 

 

That vote went VERY badly for the school board.  I think we all thought a million dollars per kid, roughly, was a sort of high price for a school. 

 

 

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Honored Advisor

Re: I have a property tax question.

Couple of thoughts:

 

Many in 401k investment, 403b, etc. are subject to the whims of the stock market.  Don't they get taxed on capital gains, when assets are liquidated for funding living expenses in retirement?

If not, then I have really messed up by being self-employed. 

Second thought: We chose to pay down debt on farmland and such, too.  Those are business expenses, and property tax on them is a legitimate deduction, right?

I remember my father raising cane at the tax man putting so much on their house, less on the land...which is in land use tax program (use-based deferral) anyway.   Isn't your land given this kind of break? 

Ours all has flat values in either county/state, by productivity ratings.  Virginia treats us better than North Carolina, though.

 

Get involved, in fighting the tax rate hike.  We just voted down a similar referendum in Carolina.  It crashed and burned.  The fact that it was going to cost almost a million dollars per child for a new school was ridiculous to those of us who actually pay taxes here.

 

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Advisor

Re: I have a property tax question.

There's always two sides of the story. Hauling rock from a local quarry, I visited with a truck driver of a county vehicle. He told me they ran 21 tons, net weight on their tandem axle bobtails. I can't even legally haul over 13 ton, due to bridge laws. And county trucks have shorter wheelbases than my truck. That's where the roads are abused, not by property owners but the county charged with maintaining the roads. They haul rock every week in the year. I haul grain maybe six weeks a year.   Big difference.