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UCGal.
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January 13, 2013 at 8:10 PM #20452January 13, 2013 at 8:29 PM #757652
EconProf
ParticipantYou and a lot of others are leaving CA, ctr70. The sad thing is we are losing the middle class taxpayers, the wealthy taxpayers now subject to a 13% state tax rate (even on their 2012 income), and attracting the tax users. CA has 33% of the nation’s welfare recipients, yet only 12% of the population.
Keep us in touch with what you experience in WA as you settle in there.January 13, 2013 at 9:40 PM #757653SK in CV
Participant[quote=EconProf]You and a lot of others are leaving CA, ctr70. The sad thing is we are losing the middle class taxpayers, the wealthy taxpayers now subject to a 13% state tax rate (even on their 2012 income), and attracting the tax users. CA has 33% of the nation’s welfare recipients, yet only 12% of the population.
Keep us in touch with what you experience in WA as you settle in there.[/quote]Any evidence that wealthy taxpayers are leaving the state (the OP notwithstanding, who has never actually paid 10% of income in state tax, nor would he ever)? That has not happened when taxes increased in CA in the past, nor is there evidence it’s happened in other states that have raised their top marginal rates.
January 13, 2013 at 9:51 PM #757654enron_by_the_sea
Participant[quote=SK in CV]
Any evidence that wealthy taxpayers are leaving the state (the OP notwithstanding, who has never actually paid 10% of income in state tax, nor would he ever)? That has not happened when taxes increased in CA in the past, nor is there evidence it’s happened in other states that have raised their top marginal rates.[/quote]
I don’t know the statistics, but at least one person I know is moving to Nevada.
He doesn’t need to work for a company. Has no family ties to this state. I can understand why moving to Nevada becomes attractive to him. Most people affected by prop 30 won’t move because they have a job, family, friends and roots that will keep them here.
January 13, 2013 at 9:58 PM #757655Participant[quote=enron_by_the_sea]I don’t know the statistics, but at least one person I know is moving to Nevada.
He doesn’t need to work for a company. Has no family ties to this state. I can understand why moving to Nevada becomes attractive to him. Most people affected by prop 30 won’t move because they have a job, family, friends and roots that will keep them here.[/quote]
In the past, both in CA and in other states, the statistics have been that there has been no material change in the number of high income taxpayers when rates go up. Not zero. But no material change.
January 14, 2013 at 9:43 AM #757670ParticipantThe study you cite came in for tons of criticism as soon as it came out, and has largely disappeared from view as a result. It was biased in who initiated it (State Franchise Tax Board), and who researched it.
Its main flaw was to draw a sweeping conclusion from too little data. To change the tax rate by 1% and then ascribe millionaires’ moving pattern changes, or lack thereof, to the tax change is quite a leap. Many other factors weigh far more in the decision, particularly where we are in the business cycle. The dot-com boom of the 1990s and the RE boom and bust of the middle of the last decade affect moving decisions into or out of the state by the wealthy far more than tiny changes in taxes.
And the last change in marginal tax rates from about 10% to about 13% wasn’t so tiny. It will likely be the last straw for many wealthy Californians. It will be interesting to see the results, which should be apparent in the very near future.January 14, 2013 at 12:17 PM #757689bearishgurl
ParticipantWell, I think there is a “disconnect” in the mind when it comes to coastal RE (within coastal counties) in CA with ctr70 and several others on this board.
The properties they are seeing on the street along with their respective surrounding areas, what these properties sold for in the trough of three years ago AS WELL AS what they are selling for now have not been up to these individuals’ “standards” and never will be. This problem is not fixable.
Based upon his prior posts, I think the OP HAS purchased investment property here but cannot, for whatever reason, actually see himself settling here for the long term.
There is actually nothing wrong with this mindset. Buying in CA coastal county locations, whether for a personal residence or an investment is not for everyone.
I see today that (expensive) Boulder, CO (which I “pushed” on this OP on several occasions) has the WORST employee satisfaction of any region in the country, acc to Forbes:
Heading the list of the unhappiest U.S. cities to work in is Boulder, Colo., with an index score of 3.45. Boulder workers expressed the most pessimism in the Growth Opportunities and Compensation categories, which scored 2.81 and 3.29, respectively.
The Boulder region is lowest on `available growth opportunities’ of anywhere in the nation and home to several large tech companies. This is likely due to the sunshine/ski/mtn biking/camping/river rafting/hiking and hot-air ballooning “tax” there :=]
In other words, “We won’t be promoting you and we don’t give raises – just ‘bonuses.'” If you don’t like it here, you are free to leave.”
I thought SD County was bad in this regard but it apparently didn’t make the bottom ten OR the top ten “happiest places to work in.”
That’s not to say Boulder isn’t a good “retirement area,” and since the OP is not an “employee,” per se, he might still like it, but Boulder is no doubt is MUCH more expensive to live in than Seattle.
I’ve never been to Seattle, ctr70. You just so happen to be moving in the middle of its renowned “rainy, dreary season.” Keep us Piggs posted as to how you like living and doing biz there!
January 15, 2013 at 11:20 AM #757741NeetaT
ParticipantI say “good for you” if you leave CA to move to a business friendly state. I will eventually do the same thing. The Sacramento “Gravy Train” will inevitably fall just like the Roman Empire. CA is such a nice place to live with the exception of the welfare government. What a shame it is to be subject to Sacramento’s extortion.
January 15, 2013 at 6:53 PM #757770mike92104
Participant[quote=SK in CV][quote=enron_by_the_sea]I don’t know the statistics, but at least one person I know is moving to Nevada.
He doesn’t need to work for a company. Has no family ties to this state. I can understand why moving to Nevada becomes attractive to him. Most people affected by prop 30 won’t move because they have a job, family, friends and roots that will keep them here.[/quote]
In the past, both in CA and in other states, the statistics have been that there has been no material change in the number of high income taxpayers when rates go up. Not zero. But no material change.
I think the real worry should be on the middle income taxpayers. I know of 7 individual or couple that have moved out of the state in the last 2 years. All went to lower tax burden states. Washington, Arizona, and Texas.
January 15, 2013 at 10:05 PM #757783Participant[quote=mike92104][quote=SK in CV][quote=enron_by_the_sea]I don’t know the statistics, but at least one person I know is moving to Nevada.
He doesn’t need to work for a company. Has no family ties to this state. I can understand why moving to Nevada becomes attractive to him. Most people affected by prop 30 won’t move because they have a job, family, friends and roots that will keep them here.[/quote]
In the past, both in CA and in other states, the statistics have been that there has been no material change in the number of high income taxpayers when rates go up. Not zero. But no material change.
I think the real worry should be on the middle income taxpayers. I know of 7 individual or couple that have moved out of the state in the last 2 years. All went to lower tax burden states. Washington, Arizona, and Texas.[/quote]
Uhhh, Mike? Hello?? Your “friends” haven’t been gone long enough to crawl back to SD broke and desperate to “start over” after asking to “rent a room” from you “for just six months.”
If they bought homes in their new locale, did they (or you) actually think they could get out with their heads above water in ~3 years?
Think again.
They are going to end up telling you that they will do anything to get outta there and back to SD.
Give it another year-plus.
January 15, 2013 at 10:28 PM #757784paramount
Participant[quote=NeetaT]I say “good for you” if you leave CA to move to a business friendly state. I will eventually do the same thing. The Sacramento “Gravy Train” will inevitably fall just like the Roman Empire. CA is such a nice place to live with the exception of the welfare government. What a shame it is to be subject to Sacramento’s extortion.[/quote]
Very well said, my plan – rather than move – is severely reduce my expenditures. No discretionary spending at all – no eating out, no new cars or BMW’s.
Nothing. Staples only.
January 15, 2013 at 10:39 PM #757785Participant[quote=paramount][quote=NeetaT]I say “good for you” if you leave CA to move to a business friendly state. I will eventually do the same thing. The Sacramento “Gravy Train” will inevitably fall just like the Roman Empire. CA is such a nice place to live with the exception of the welfare government. What a shame it is to be subject to Sacramento’s extortion.[/quote]
Very well said, my plan – rather than move – is severely reduce my expenditures. No discretionary spending at all – no eating out, no new cars or BMW’s.
Nothing. Staples only.[/quote]
paramount, you are not alone. What you describe here is actually what most homeowners in SD County do to stay afloat and still raise a family and save for college/retirement simultaneously.
The beauty of this plan is, SD is NOT Kansas City. You can feel like you’re on “vacation” in your off-hours without leaving home :=]
It is only when their house is paid off that their discretionary income level goes up, whether they are still working … or not.
January 16, 2013 at 8:25 AM #757799no_such_reality
Participant[quote=bearishgurl]
Uhhh, Mike? Hello?? Your “friends” haven’t been gone long enough to crawl back to SD broke and desperate to “start over” after asking to “rent a room” from you “for just six months.”
[/quote]Hmm, let’s see.
Friends #1, moved to Phoenix 5 years ago. Happier than a bikini watcher on main beach in August. They were shaking their heads at the taxes we past over Christmas.
Friend #2, moved to Austin 6 years ago. No longer stressed, feeling broke and living in a nice house on an acre instead of scraping by in a one bedroom apartment in beach town.
Friends #3, went St Louis 6 years ago. Happy, job is good, lots of opportunity. Has a 15 minute commute instead of an hour plus from the IE to the coast.
Friend #4, went to Atlanta 4 years ago. Happy, started her own business, less stressed now.
Friend #5, Vegas 5 years ago. Came back 3 years ago. Not happy there, not all that happy here.
That’s an 80/20 success rate.
January 16, 2013 at 8:59 AM #757803Participant[quote=no_such_reality][quote=bearishgurl]
Uhhh, Mike? Hello?? Your “friends” haven’t been gone long enough to crawl back to SD broke and desperate to “start over” after asking to “rent a room” from you “for just six months.”
[/quote]Hmm, let’s see.
Friends #1, moved to Phoenix 5 years ago. Happier than a bikini watcher on main beach in August. They were shaking their heads at the taxes we past over Christmas.
Friend #2, moved to Austin 6 years ago. No longer stressed, feeling broke and living in a nice house on an acre instead of scraping by in a one bedroom apartment in beach town.
Friends #3, went St Louis 6 years ago. Happy, job is good, lots of opportunity. Has a 15 minute commute instead of an hour plus from the IE to the coast.
Friend #4, went to Atlanta 4 years ago. Happy, started her own business, less stressed now.
Friend #5, Vegas 5 years ago. Came back 3 years ago. Not happy there, not all that happy here.
That’s an 80/20 success rate.[/quote]
So none of them actually left because of the tax increase on very high income taxpayers.
January 16, 2013 at 9:16 AM #757805Participant[quote=SK in CV]
So none of them actually left because of the tax increase on very high income taxpayers.[/quote]They left because of high taxes on them!
And perceived better opportunities elsewhere.
Your prior link to the Stanford study is very good. It really highlights the problem of California’s current tax paradigm. When the group you’re relying on to generate the bulk of your taxes can shift due to economic reasons by 50% in two years, you’re going to have continual problems.
However, my point was to counter the ‘everybody will come crawling back to SD meme’
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