[an]

[quote=SK in CV]Hate to quibble over a few percentage points, but on 3.5 million, 1% is a lot of money. It wont be 53%. Probably no more than high 40’s.

And more likely than not, no significant income taxes would be due until April 15th next year. There are safe harbors that would eliminate the need to pay huge quarterly estimates this year.[/quote]Based on http://www.moneychimp.com/features/tax_brackets.htm and $4M (not $3.5M since, that’s the value the house is supposed to be at), federal tax would be 38.54%. State income tax is 11.644%, based on https://webapp.ftb.ca.gov/taxcalc/calculator.aspx?Submit=2013+Tax+Calculator&Lang=english&redirectURL=OTC. So, combined, it’s ~50%. less than the ~53% I gave a rough estimated but higher than high 40’s you stated. Of course, it depends on what else you’re deducting. 3% less = $120k for $4M. Not chump change for most, but it still wouldn’t change my general point. Also, obviously, if you really were the winner, you’d get yourself a good tax advisor and not trust some vague estimate from some anonymous person on Pigg.

[an]

[quote=spdrun]Stuff that caps out at 6% is usually middle to high-end, meaning that it’s easy to keep rented with minimal heartache. It’s also in areas that you’d actually want to live, unlike Fresno or Texas.

And a lot of mx that you’d need a property manager for is taken care of by the condo management company.[/quote]As the saying goes, higher risk, higher return. Also, just because it’s low end doesn’t mean it’s always a big heartache. I know people who have rentals in Fresno and one of their property, their renter has been in there for over 10 years and the other ones have renters in there for 3+ years so far. Those are life long renters who are on welfare.

[an]

[quote=spdrun]Or you buy $1.5 MM of condos that rent at 6% cap and have $90k/yr income. Increasing with inflation, with healthy tax deductions 🙂

Removes the temptation to touch the principal.[/quote]Or buy $1.5M of SFR in areas like Fresno, CA or TX that make 8-12% cap rate and hire a good property manager to maintain that portfolio. There are a lot of options out there. I only brought up 3-4% as an extra conservative option and still get you ahead of taking the monthly cash payment.

[an]

[quote=rasaid111]If I understand your response, I don’t need to pay taxes immediately, I can wait to sell the house and pay the taxes and 3% interest. right?

For you how much money could you receive after all expenses if you sell the house for $3.5 instead 4
Thanks again[/quote]Take $3.5M, then subtract ~53% for taxes. You can then round down to the nearest hundred thousand to for fees/penalties/etc. I’m guessing $1.5-1.6M? If you invest $1.5M lump sum in a long term CD making say 3% over 20 years, you’ll have ~$2.7M after 20 years. That sounds better than $2.1M if you take the monthly cash payment. Increase that rate to just 4% gets you $3.2M after 20 years. Still very conservative estimate for a 20 years average, IMHO. Considering ~7-8 years ago, you can find CDs in the 6-7% range.

[an]

[quote=spdrun]You’d likely have to make an appropriate estimated tax payment for the quarter that you won the prize.

If you do that late, you’ll likely be charged ~3% per annum interest rate until you do. TSOR says that money only gets withheld up front in case of a cash prize.

Thus if you can sell within 6 mos to a year, there’s likely some wiggle room.[/quote]Then, wouldn’t it be cheaper to “borrow” from the IRS than hard money? 3% beats 10%+. I’d totally get the house and sell it. Then pay the taxes from the proceed of the sell. Even if it takes >1 year (that just mean you’re not pricing it right and price of the house isn’t really $4M), it’s still worth it to just “borrow” from the IRS than anyone else.

[an]

I’d take the house if it’s truly a $4M house, assuming that I can sell it for $4M. I would then sell it, pay the taxes, and invest the $1.9M. I can never see myself living in a 7k+ sq-ft house. I rather live in a small house w/ panoramic ocean view than a ginormous house w/out ocean view.

Do you have to pay the tax on day 1 or do you pay it at tax day? What happen if you don’t pay the tax right away? How much penalty do you incur?

[an]

[quote=6packscaredy]I’ve had fun teachers, funny teachers, interestingcteachers, depressed teachers, knowledgeable teachers, but no one who has ever caused me to learn more than I get from a book.[/quote]
But none of those characteristics make a good teacher. Maybe some of those make a good friend or person to be around, but definitely not a good teacher. SK listed some characteristics that make a good teacher. If you were never had a teacher who increased your motivation, curiosity, critical thinking skills, make you want to actually learn about something you didn’t before, make you change your perspective on things, open up your horizon with new ideas, then I seriously believe you’ve never had experienced with a good teacher. I’ve had some great ones that had some of those criteria. I also had some really bad one that had none of those criteria and talked to the board the whole class long. Kids were either sleeping or passing note the entire time and he didn’t even notice.

[an]

[quote=6packscaredy]Motivation? Curiosity?

Stifled during my schooling.

Critical thinking?

No.

Learning to survive in a rigid hierarchical oppressive system suffused with boredom and arbitrary authority figures?

Yes!

Which is not to say ghats not invalyable[/quote]So what you’re saying is you haven’t had a good teacher in your entire education experience. That’s a lot of bad teachers…

[an]

[quote=6packscaredy]No one can teach you the law. You must learn the law yourself.

I suppose a good teacher directs you toward better questions to think about.[/quote]So when you went to law school, you never asked the teacher anything and teacher never taught you anything you didn’t already know?

[an]

[quote=6packscaredy]I am not sure what a good teacher is.

Most things we learn ourselves.[/quote]Then what’s the point of having teachers at all if we learn things ourselves?

[an]

[quote=all]AN,

As CAR pointed out – you do have options. You are not forced to send your kid to a public school, unless your kid has special needs (not necessarily due to medical condition, but also due to socio-economic conditions).

You don’t have options when it comes to paying your taxes. You have to pay your taxes and some of that money will be used to fund the public education system regardless of your participation in that system.

I am not saying that public schools are outperforming private schools. Au contraire, I am not satisfied with my kids’ school and I am reevaluating options.[/quote]I never said we don’t have option. I just took offense to the claim that we have a lot of option. I’m fully aware of the socio-economic “special needs” you claim. Which is why I say the status quo isn’t working, at least for people who are not rich. It gets even worse when you’re an immigrant who are not fully aware of the options and the language skills to navigate the system. Which is why I say we don’t have a lot of choice. It shouldn’t be that hard to choose a better school for your kid.

I’m fully aware we don’t have an option for paying our taxes. But that’s where our agreement ends. The status quo is that our tax $ goes to fund public education system. I would much rather our tax $ goes to fund the education of a child. I place the child’s education first, not the system that educated the child. If there’s a better system out there, it should be very easy for parents to choose the new system that does a better job.

I’m not saying all public school are bad, but there are some really bad public schools out there and the kids there are stuck because of where they live or their parent’s socio-economic situation. I want those kids to have a better option.

[an]

[quote=all][quote=AN]CAR, my numbers were from greatschools.org 3-4 years ago. It was $12-13k back then. So, it seems like there are a lot of budget cut over the last few years. But based on the parents I talked to with kids in public schools, the class size has also risen over the last few years as well. So, although the expenditure went down, our children got the short end of that stick. At a private school, $10k will get you a class size that’s 1/2 of what it is in public school. So, something is not adding up. I actually don’t want spending cut for education, I just want to get more for our tax dollar. Maybe it’s the fact that public school is much more top heavy (as you stated) that’s the reason why we’re spending so much and get so little.
[/quote]

You can check the numbers for the past 10+ years on the link CAR provided. SD unified maxed out at $10,500 few years ago. Poway unified is 20% lower.

Private schools keep the cost down by turning away high-cost students. When my friend’s kid fell behind the grade level in reading the administrator told my friend to get a tutor or take the kid out. There are far fewer subsidized lunches, special needs or remedial cases in private schools.[/quote]I’m not defending my greatschool.org’s number. I guess they were misreporting, which is why they took it down. But even with the actual number CAR posted, I’m still not satisfied w/ the status quo. We’re paying on par w/ some of the private school (excluding the elite LJCD, Bishops, etc). Those schools have class size that’s 1/2 of what the public school kids have to deal with. Why?

You and CAR like to point out special ed as a reason why the public school cost is so high. Something is not adding up. I don’t have special needs kids, so I don’t know exactly what it takes to educated them, but I do have some questions. What’s the % of students are special needs? How much does it really cost to educate special needs vs regular students? Do you think that if we move the special needs kids to a different spending pool, we can get public school class size to decrease by 1/2?

Lastly, I still stand by my original statement that I’m dissatisfied w/ the choice we have today. CAR and you are fine w/ the status quo, I’m not. But we can agree to disagree. But I like to ask you two who think the public school system is just fine and in many cases are superior than the private schools with more qualified teachers, then why not open it up to competition? If public school is as great as you make it out to be, then there’s nothing to be afraid of, right? People will naturally just stick with the public school, since it’s better.

[an]

CAR, my numbers were from greatschools.org 3-4 years ago. It was $12-13k back then. So, it seems like there are a lot of budget cut over the last few years. But based on the parents I talked to with kids in public schools, the class size has also risen over the last few years as well. So, although the expenditure went down, our children got the short end of that stick. At a private school, $10k will get you a class size that’s 1/2 of what it is in public school. So, something is not adding up. I actually don’t want spending cut for education, I just want to get more for our tax dollar. Maybe it’s the fact that public school is much more top heavy (as you stated) that’s the reason why we’re spending so much and get so little.

As to my main point of choice. Again, I’ll repeat, you seem to be perfectly satisfied w/ the status quo. I’m not. We’ll just leave it at that.

FYI, I’m not complaining, just stating what I see. I’m fully aware of those schools you mentioned. I’m pretty sure I’ve spent more time and energy researching education options for my kids than most parents out there. I wanted more choices and I wanted those choices to be much easier for achieve for your average parents. I want the choices to be front and center for them. I want a lot more High Tech High like schools all over so people don’t have to get wait listed and hoping their kids are the lucky few to get in. I want it spread through out the entire county so parents don’t have to make a big sacrifice to send their kids to good schools. I want inter/intra district transfer to be the thing of the past and any kid can go to any school that their parents wants as long as there are space. So on and so forth. I.E. I want a lot more choices. While you’re satisfied w/ the choice we have today. We’ll just have to agree to disagree.

[an]

[quote=CA renter]Once again:

Your taxes entitle your (and everyone else’s) children to an education at a public school. That’s all you’re entitled to; nothing more. Whatever you want to do in addition to that, or outside of that, is on your dime.[/quote]
once again, that’s the status quo. I am fully aware of it. Some are fine with it and some are not. I want more choice for everyone and I want to make our tax dollar go further with more competition and choices. I know that will disrupt the status quo. I don’t expect it to happen in CA.

[an]

[quote=CA renter]AN,

No, we do have the freedom, but if you don’t want to make the sacrifices to make it happen, don’t blame anyone else.

Regarding that “second income,” all too often, the second income earner is working at a loss, especially if they are working for low wages. After taxes, clothing expenses, higher food expenses (like it or not, when both people work, they’re more likely to eat out), higher transportation costs (gas, insurance, accelerated maintenance, accelerated car purchases, etc.), childcare expenses, etc…so many people are actually working for negative earnings, especially among those who are working for low wages to begin with.

And you need to re-check those numbers on private vs public schools. Most private schools that are equal to or better than comparable public schools cost more, not less. The reason public schools appear to cost more per capita is because they educate, feed, and care for the most expensive students (special education/learning disabled, socially/economically disadvantaged, ESL, etc.) and have far more resources than private schools do, especially for these students. Public schools also have more qualified teachers, on average, than private schools.

Good schools are good because of the parents whose children attend those schools. The parents have the greatest impact on how students (and schools) perform. If you want your kids to do well, nurture their curiosity and interests, read to them, take them to museums, talk to them about a variety of topics, etc. That is the #1 way to make a difference in your child’s life…and it’s all free, or nearly so.

Oh, and get them the hell away from those electronic babysitters![/quote]Who said I’m not making sacrifices? However, that’s besides the point. It doesn’t matter what I do/sacrifice, I say it like it is. I don’t see our system as having very many choices. I’m fully aware of your persuasion with the teachers union, so, I’m certain this conversation will go no where. Just stating it like how I see it, as a parent.

I would say the feminist movement will disagree with your assessment of second earner greatly. I’ll leave that at that.

I’ve rechecked my numbers many times. Public schools in SDUSD are spending about $12-13k/student. There are a lot of private schools that are charging <$10k. Good Montessori schools that feed into LJCD/Bishops/etc. are charging $10k/student. So, yes it's much cheaper. Here's a kicker, even with less $ per student, the Montessori I'm referring to have a class size of 12 to 1 for 1-3rd grade and 20 to 1 there after. That's well bellow the class size of SDUSD schools. I'm hearing class sizes of 30-35 to 1 student to teacher ratio. It doesn't matter how good you are, if you have to deal w/ 2x as many students, you'll get much lower quality. I haven't even touched on the quality of the education. The kids in the montessori are taught Mandarin and Spanish from the Preschool level and continue through 6th grade. Then there are art/band/science/etc. So yeah, looking at the quality of the schools in SDUSD and then look at the many private schools out there, I don't buy that public schools are cheaper and better. If you truly believe that's the case, why not open up the voucher system and lets see what the parents/students will do. There's nothing to be afraid of if the public schools are really as good as you say it is.

[Author]

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