Why no tax break for renters? Right now, $350 can be written off for every $1000 of mortage

[Captain Hilts]

payments.

Wow! Over a third!

What about us renters?

[closeupready]

1. The theory is that your landlord will be kind enough to pass this on to you, even though he won't.

People who tell us this are homeowners themselves.

[marshall]

61. Wouldn't it depend on whether the rental property is mortgaged?

Not everyone's property is mortgaged--some do still own 100 percent of their property.

[wryter2000]

72. Yeah, right

That's what Howard Jarvis told us in CA when we passed Prop 13, which continues to bankrupt the state. He even went around trying to convince landlords that they should pass on some of their property tax savings to their tenants. Never happened, of course.

I was a renter back then, and my landlord raised the rent right before Prop 13 passed so he wouldn't have to try to do it after. I never saw a penny of his savings.

In CA we do have a renter's tax credit, and it would be a good thing if everyone did.

[truedelphi]

87. Uh last time I invoked the Calif renter's credit, it gave my household

A whoopoing $ 120 back.

Hardly enough to help out the renters in a state where the average late fee charged by landlords can be $ 75 or more.

[Rabrrrrrr]

2. Because renters, single people, and the childless are considered garbage in America

They only like our money. They don't like us.

Think about car insurance, also, as an example - cheaper if you're married, cheaper if you own a home instead of rent.

Fucking insane, isn't it?

[Captain Hilts]

10. Here in Monty County MD, renters have NO rights when it comes to rental rates, etc. nt

[hlthe2b]

13. Yup... you nailed it...

:mad:

[JoDog]

22. My feelings exactly

If you don't own a home, have kids or are married, you are invisible in America.

We pay into all sorts of tax breaks and write offs we may never get to take advantage of. It's like everyone else's spreadsheet is balanced on our backs.

[Demobrat]

27. Dupe

nt

[Demobrat]

28. Tell me about it.

I'm all three. Which makes me good enough to pay for schools, parks and prisons for other people's offspring, but that's about it. Other than that I don't count.

[Raineyb]

35. Indeed. Take our money but God forbid we might need something

because as usual we're SOL. We just don't count in this country.

Regards

[tabbycat31]

57. you hit the nail on the head

As a single, childless renter I don't like it how I am subsidizing homeowners with children.

[cascadiance]

63. California used to give renters $50. And feds used to allow write offs of other debt too...

like credit card interest, as well as sales tax.

But all of those deductions that would have helped the middle class were dumped to push them into getting into homes and say that's the only way you can get that kind of write-off.

So everyone did. And some pushed themselves into home mortgages that they shouldn't have, and were strongly encouraged by unscrupulous lenders that wanted to take advantage of this "herding effect"...

[cascadiance]

64. Right now there's no incentive for putting in solar power for rental properties either...

Since the renter pays the electric bills...

1) Landlord feels no need to do so, since the renter picks up the energy tab.
2) Renter doesn't want to touch investing in any changes to a rental property they won't benefit with, which precludes them putting in solar tiles.

Something should be done to incentivize getting solar panels put in on rental homes...

[wryter2000]

73. CA still does

And it's more than $50. I can't remember what I used to get, but it was a decent amount of money.

[cascadiance]

86. But its not to everyone any more like it used to be...

You have to be at the low end of the salary spectrum to qualify any more. Not sure where the cutoff is now. Won't matter to me next year I guess since I just moved away.

[taught_me_patience]

94. Agreed totally. In fact renters, singles, and childless

are pretty much shit to america and DU.

[dysfunctional press]

3. you get an incentive to buy.

and it's a buyer's market.

[Donnachaidh]

6. yeah -- all those *no money down* loans still available?

Incentive my shiny metal @ss.

[dysfunctional press]

36. boo fucking hoo...

who ever said that EVERY tax policy HAD to benefit everyone directly anyway?

[Raineyb]

52. Who said it was acceptable to have tax policy that consistently screws

the same population.

Regards

[dysfunctional press]

90. and which population would that be, and in what ways have they been getting consistently "screwed"?

:shrug:

[verges]

69. OK. So name a couple

that benefit ONLY single, childless, renters.

[Cetacea]

71. Just keep having babies. Thank you.

[dysfunctional press]

91. not every subdivision of the population is going to be targeted directly-

but most people fall into more than one of the many many many subdivisions and combinations thereof that can be imagined- and along the way, most people benefit from one part of the tax code or another. a lot of people fall into more of them, because tax-codes are also written to encourage people to make the economic/lifetstyle choices that society has chosen to encourage- home ownership being one of the big ones, because it generally promotes stability within a community.

[JoDog]

23. An incentive to buy

only works if you can get a loan. Banks are refusing everyone--even people with FICO scores in the 700's.

[dysfunctional press]

40. not all banks.

there are still people buying houses and people getting loans to do so.

[robinlynne]

82. here in LA, I have been looking at the ads. Houses are selling for CASH.

I rent, and would love to buy an apt, all the affordable ones are listed for cash. cash. unbelievable. That means a billionaire can come and swoop up all the properties, and we who need homes cannot buy. Then when the market goes up, they will become un-affordable again.

[Donnachaidh]

4. SOL.

Personally, I'd like to see laws with more protections for renters than an actual tax cut. :shrug:

[Captain Hilts]

14. Me too, actually. My apt. management have increases TWICE the size as 'recommended'

by Monty County for lower quality of services, etc.

Not a damned thing we can do about it.

Most people who rent in this area are:

Women
Older
Not native to the US or the English language

So, the landlord knows we won't complain.

[dana_b]

31. those who can least afford it?

especially older folks on a fixed income. That makes me nauseous.

[Captain Hilts]

41. We discovered that they were screwing over the 80+ woman downstairs from me.

She'd lived in an identical apt. 10 years longer than I and was paying HIHGER rent than I. They did it because they knew they could.

[dana_b]

44. oh jeez

how do these people sleep at night?

[dana_b]

30. yes!

In some of the big cities there is rent control, at least. Where I live - no way. The landlords can raise the rent all they want.

[BR_Parkway]

5. Not sure how you calculated that - but it's not correct - you would

put the total mortgage interest in as a deduction from other income and then pay taxes on the amount left. But if you don't exceed the Standard Deduction for your family size, then you come out better taking the Standard deduction (the same as any renter could claim for the same size family) - so the benefit is only really going to be on any mortgage interest paid over and above the Standard Deduction

[Captain Hilts]

8. I was trying to be brief! Thanks for adding details. nt

[truedelphi]

88. It all depends on where you live etc

Friends of mine who have bought homes here in California pay at least $ 2,200 a month for a mortagage (Often considerably more than that.)

If a lot of that is interest, as some of the newer home loans are, you arelooking at almost double the standard $ 12,000 for a married couple.

Have single friends who are doing that, and they are also augmenting their mortgage payments by taking in renters and not paying on income from renters. So it can be a win-win for those who have a home, assuming you like those who move in with you

[KansDem]

7. You'll get your break from your landlord...

...who will no less reduce your rent in relation to his/her write-off.

At least, that's what I was told when living in California and renting during Prop. 13 days...

on edit: spelling...

[John Q. Citizen]

21. CA had a renters credit and still does I think. Prop 13 is still in effect, though modified.

[Johonny]

24. Sort of

It phases out at around 35 K. Which in Los Angeles isn't exactly high living.

[dana_b]

37. or San Francisco

35K - you can't aford anything around here for that price unless you live with others. But if you are single and you only make 35k, you have to have a roomate.

[robinlynne]

83. oh yes. My landlord sends bills for 2.00, 4.00 anything he is allowed to charge

besides the rent.

[Ganja Ninja]

9. Yup.

Looks to me like we're subsidizing homeowners. I think we deserve a tax break since we weren't the people that caused this mess by living beyond our means.

[notadmblnd]

11. I believe renters currently get a homestead property tax credit when they file their state

No? I can tell you that as a home owner, I've never qualified for this. Where's mine? It not fair?

Is that all were going to hear about the stimulus from people who feel they've been excluded from the package?

Homeowners do not get 350 off every 1000 on their mortgages. If a home owner has enough deductions to itemize on their taxes, they get to use the interest they pay on their mtg as a deduction. If the interest and other items are not greater than the standard deduction, the homeowner gets squat. Does that make you feel better?

[Skink]

12. Rents in the last 30 years compared to morgages have risen just as dramaically.

Double the money for half the square feet.

[waiting for hope]

17. My mortgage for a 3 bedroom house

is less than rent on a 3 bedroom apartment in my area - even if we tried to downsize, we are still better off in our house.

[sinkingfeeling]

15. No, $350 is deducted for every $10000 of mortgage interest.

[Captain Hilts]

16. Thanks!

[SmileyRose]

18. The landlords I know base their rents on their actual costs in relation to what the market will bear

I have 12 clients who own rental property. 9 have been with me for 10 years or more. All 9 have at some point lost money, short term, on their rental endeavor because for that year the cost of owning the building was more than what rent the market will bear or what their lease agreements would provide. The costs of ownership were deducted on federal and state taxes but short of ending up with no income or corporate tax liability they were still on the hook for the money. None of them have ever raised their rates more than 5% at the end of a lease. I have one client that has lost money every year he's owned one particular 4 family. It is in an economically disadvantaged part of Atlanta and is an expensive old building. He uses it to offset other buildings in more profitable places.


As for the big boys, 20 years ago we had a new huge complex go up about 2 miles from me. They were given a 10 year property tax abatement in exchange for keeping the rent target in a certain range. It's now 10 years after they started paying the property tax and the rents are still in the same range in relation to rests in other areas of Atlanta.

You have to expect them to want a half decent profit. Dealing with a rental building is no fun and dealing with tenants come sometimes be a real pain in the ass.

[Captain Hilts]

20. In Monty Cty, the last two years, they recommended an rent + of 3.3%. Our rent went up 6%. 8% once.

And we have no right to contest it.

[SmileyRose]

25. Your protest rights are moving when the lease agreement is up.

one of the joys of renting. You can pick up and move any time you like.

[dana_b]

42. yeah- such a joy

coming up with another deposit, first and last month's rent. then the landlord's are SO NICE to give you back all of your security when there is no damage to the apartment, right? Riiiiight.

[Maine-ah]

43. not really. There's that funny little legal document called a lease

that most renters have to sign.

I own my own home. My mortgage is less than what most renters pay. I bought responsibly in 2001. It's the economy that's fucked us.

[Captain Hilts]

47. Move and your rent will go up 30%+. nt

[SmileyRose]

59. This is kindof an odd time in history

I only know the Atlanta market and the metro Detroit market but normally rents are lower than what what homeownership costs (add PITI, maintenence etc). In my particular metro Atlanta county the bubble never came at all so rents are still on par with home ownership costs. I can rent a 2 bed/2 bath 1000sq ft apartment for about the same as my net costs in this house - AND get the summertime pool, professional landscaping, free use of the clubhouse for entertaining, a really nice outdoor walking trail, be right ON the bus stop, inside and outside maintenance, and the free fitness room.

Both in my Metro Atlanta county and back home near Detroit, it's very common for older folks who can't do the work anymore and get sick of workmen that don't show or do shitty work to just sell the house, invest the proceeds and move into a comparable apartment in a complex instead.

My mom back in Detroit recently did this and got an apartment is a special 55+ community. She's down to a 1 bedroom and has a detached garage space now at the other end of the building rather than 15 steps out the back door, but her car is still out of the icy weather - she had no maintenance worries and she said her monthly cash flow in much better. She did her homework ahead and knows the rents where she is have consistently gone up by about 3% per year on average so it's easy for her to budget that in. With the house she never knew what would break next and getting someone out to fix it right usually took waiting until one of my brothers could come.

[Demobrat]

62. When I lived in Los Angeles my rent went up 50% after nine months.

I was forced to move. Now I live in San Francisco under rent control, and will never leave. I have no desire to buy a place, which would mean paying triple for the same amount of space, and will never put myself in that position again, so the poor old landlord will be stuck with me until I'm dead.

[Donnachaidh]

74. define a *half-decent profit*.

No one held a gun to their head and told them to become landlords.

Personally, I'm sick of the whining from landlords who have NO qualms about jacking rents during a recession. I guess they are supposed to be *recession-proof*, too?

[grasswire]

19. why no protection for renters from eviction due to foreclosure??

How many families are being evicted because the landlord didn't pay the mortgage on the property even though they got the rent money, and the house went to foreclosure?

Answer: tens of thousands of families.

Where is the relief for them?

My family is in that situation right now. The landlady hasn't paid the mortgage since September. The bank has announced that it will sell the house out from under us.

Woe and misery. Where is the protection for families against this?

[SmileyRose]

29. I totally agree with you.

Likewise, if property management or the owner fails to pay utilities on the building, renters should have an easier way to get compensated than having to file a lawsuit. I'd like to see every local government have a citizens board to handle these kinds of things, hold security and last month's payments in escrow etc.

My client who owns property in the "bad" part of Atlanta says even though Atlanta does do some things to control the slumlords there are still so many problems it's disheartening.

[dysfunctional press]

33. how much rent have you paid in advance?

:shrug:

usually foreclosures take longer than one month, i would think.

[grasswire]

51. your point?

I don't get what you are saying.

Even if it's several months, it's still an unfair upheaval for a family that has done nothing wrong. Moving costs MONEY, and TIME, and it's disruptive at best.

Many of those renters whose landlords are skimming the rent never get their deposits back, either.

In California, rent skimming by a landlord is a felony. That ought to be federal law.

[dysfunctional press]

92. "because the landlord didn't pay the mortgage on the property even though they got the rent money.."

unless the renter is paying months and months in advance- they aren't going to lose the money.

as far as "upheaval"- that's one of the natures of renting- it's generally not considered to be a "permanent"...there are many reasons that can arise that force renters out due to no fault/reason of their own doing, and that they have no control over.

and if you think that something should be a federal law, contact your congressman and ask how you can help work to make it so.

[Donnachaidh]

76. and if the renter is totally unaware of a pending foreclosure

They are screwed.

[dysfunctional press]

93. just one more reason to be an owner, rather than a renter.

[KittyWampus]

38. Now THAT is a great point and deserves its own thread.

[Rabrrrrrr]

39. Here's how you will be helped: the home goes into foreclosure by the bank.

The bank president's brother, Alan, on an inside job, will buy the house at foreclosure rate, which will probably be at a 25% discount.

Because Alan had the incredible and supremely above-human compassion to buy a foreclosed house in this market, and thus save the bank, the government will give him a big tax break.

Knowing he will have a big tax break, he'll put some money into the house, improving it. Because he had the supremely superhuman compassion to help support the building industry in this tough economic times, the government will give him a big tax break on the money he spent improving the house.

Meanwhile, the bank president's brother Bill will buy the foreclosed house to your left, and Carl will buy the one to your right. They do the same thing Alan does.

Now, they have three improved rental properties.

But, since they put so much time and effort into these homes, they now double the rent, because there is no law anywhere that sets any kind of limit or regulations on rent, except in very poor areas.

However, because of the improvements Alan, Bill, and Carl made, the property values of everyone's homes have gone up, and now Evie, Flora, and Gloria, the landlords of the three homes across the street, increase their rent by 50% to meet the new and improved value of their neighborhood, forcing out 3 more families who now can't afford rent.

Now, I know you're asking, "How does that help me?" - and you ask that only because you hate America, and are a god-hating liberal who only cares about yourself.

How you are helped is that you and the other five families who are now homeless can get together and form your own cardboard neighborhood under the bridge - WHERE YOU GET TO LIVE FOR FREE!

As a Republican property owner, I envy you - you are free of the burden of financial worry, free of the worry and burden of home repair, and heat bills, and water bills, and leaking toilets and carpets that need to be shampooed and floors that need to be swept.

[grasswire]

49. brilliant

...and tragic.

[burythehatchet]

54. The new housing bill addresses that. The renters will be protected until the lease expires

[grasswire]

56. do you have a link for that?

and what about those millions of people who are on month-to-month with no lease?

And why is relief being given to property owners, anyway? Why isn't the relief limited to those whose residences are in trouble?

[Bill McBlueState]

26. Massachusetts lets you deduct rent

You can deduct half your rent up to $3000. Of course, that means you max out if you pay at least $500/month in rent, and I don't think the rent of anyone in MA is lower than that.

[Gormy Cuss]

34. Yes, and I wish other states did the same.

It's a great idea. I used that deduction when I lived there--saved quite a bit on my taxes that way.

[KittyWampus]

32. Renters don't have to replace roofs or furnaces or old pipes. They don't pay insurance and if your

property is near any kind of water, insurance costs are skyrocketing.

Renters also don't have to carry costs of deadbeats.

Here is a suggestion- incorporate yourself as I did many years ago when gardening. I deducted the cost of one room on my taxes as office space.

[Raineyb]

45. That's a load of crap

Who do you think pays for these things? Do you think the landlord doesn't pass these costs on to the renters?

[Captain Hilts]

46. That's included in the rent. And, when energy prices soared, I expect a higher rent.

And so does Monty Cty. But they have more than doubled the rent over that recommended by the county.

Our quality of life has gone down. We often don't have hot water.

[KittyWampus]

50. I'd be pissed if I was paying rent and not getting hot water. Is that even legal? Health Dept.

might have an issue with rental properties not providing hot water.

[grasswire]

55. it's more difficult than you may think

We were without heat in half of the house for nearly two years because the upstairs furnace failed. We are paying premium rent for a house that was promised to have certain things repaired and/or finished. The law says that renters may force repairs by withholding rent. However, try that and your rental agreement is ended, in actuality.

Of course, there's always the option of moving out. But this house has space and location. And the disruption of moving simply because the landlord is immoral and unethical doesn't seem fair. We've done everything right. Improved the property ourselves, paid the rent, etc. The landlady has violated rental law numerous times.

Why should we be the ones taking the economic, emotional, and physical toll?

[SeattleGirl]

53. Maybe not, but we often absorb the costs when our rent goes up.

Same when property taxes go up. When that happens, my rent goes up.

Believe me, we don't get off scott free.

[Donnachaidh]

78. and landlords who don't set something by to replace those old roofs or waterpipes as part of

their BUSINESS costs are pure D STUPID.

Of course, renters have to deal with psycho landlords who want to be up in their business all the time. Or landlords who automatically ASSUME that the tenant purposely broke something in the apartment (which are usually apartments that are NOT kept up well by the landlord - either they are too cheap or they want to blame the next tenant for the problems).

Crazies are on both sides. But it is the renters who have little protection from the SLUMlords out there. And they ARE out there.

[undeterred]

48. We are shit.

[OPERATIONMINDCRIME]

58. Easy: You're Payments Are For Completely Different Reasons.

You're paying for a product (in this case a place to live temporarily). Homeowners get the deduction not for their payments outright, but because their payments also include a huge amount of interest. What the tax code is saying is that we shouldn't be taxed on money we are spending on interest. You pay no interest. Your bill is all simply 'principal', so to speak.

It really is quite obvious as to why, and there's no reason whatsoever why renters should get a tax break. If one was to say people shouldn't get taxed on money that is spent for their home, than not only should mortgage interest be deductible but the entire mortgage payment.

[McCamy Taylor]

67. Exactly. You get a tax break on the interest you pay. Not the principle.

What you pay towards the actual cost of the house, you tax. You only get the tax break on the money you pay the banks as profit. The extra money you are paying so that you can afford a house. The "I'm too poor to afford a house so I'm paying the banks a tax" tax. If they taxed that, you would be paying two taxes.

Middle class wealth is its house. If you take away the tax deduction on the interest, then there would be no middle class wealth. Doing away with the tax exemption on the interest payment on your home sounds like something that the Republicans would come up with the balance the budget and make the middle class poor.

[SoCalDem]

60. By deducting the interest, we just figure our "per month" mortgage payment is less

the tax tables are quirky, and how your interest deduction affects each person will be different, depending on your tax level, and your other deductions..

It's hard to pin down..

all I know is that we pay $14,340.00 a yr on payments, and we get to deduct the interest...and we get what we get:)

[graywarrior]

65. Seriously.

Rents in MA and NH are up around $1500 per month not including utilities. Who can afford that?

[McCamy Taylor]

66. It is to encourage people to buy in order to support the jobs in the homebuilding industry.

Otherwise, no one would invest in a home unless they were rich and could buy it outright.

[specialed]

68. There is a standard deduction on the returns that was setup for just this issue.....

people forget.

[McCamy Taylor]

70. This is a divide and conquer premise. It divides the working class.

Why are renters and home buyers fighting each other over $350 in taxes when the Big Corps and VIPs get away with sheltering millions?

[Towlie]

75. "Do you own a home?" "Yes." "Discount!" "Isn't getting discounts great?"

"There's no discount for being a renter."

[slackmaster]

77. Do you itemize your deductions?

The standard deduction is a pretty good break for most people who don't have mortgage interest to deduct.

[Matariki]

79. Without arguing the merits, the answer is that it was supposed to encourage home ownership

which in turn is supposed to create stronger and more stable communities and be at the heart of 'the american dream'.

I think we went decidedly off track with real estate as investment vs. real estate as a place to live.

[tandot]

80. We are getting a break on the interest, not on the mortgage principal

Besides, we are paying a nice chunk in property taxes, which goes toward schools and other services renters also enjoy.

[Shakespeare]

81. And the cost of those taxes is passed on to the renters.

Do NOT try that intellectually empty argument that renters don't pay property taxes, and that homeowners are solely footing the bill for city services. What a load of horseshit.

[tandot]

84. I never argued that renters didn't pay some part of the costs.

However, as a owner of a single house on a piece of land, we pay more property tax. The property tax for rental properties is usually distributed among all of the units on that property.

What a load of horseshit :eyes:

[Shakespeare]

85. That's proportionate, and exactly as it should be.

[nichomachus]

89. You will only get 35% written off if you make over $1 million a year

Most people are in a much lower tax bracket than that.