Man Wins Free Dream Home, Can't Afford Sales Tax

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[chance33_98]

Man Wins Free Dream Home, Can't Afford Sales Tax
Winner Hopes To At Least Spend A Week In Home

POSTED: 11:22 a.m. EDT July 5, 2002

SHERWOOD, Md. -- There's no such thing as a free lunch or a free house.

That's what Milton O'Bryant is learning. He's won $1 million designer beach house on the Maryland shore, in a promotion for the House and Garden TV cable channel. But while the house hasn't cost him a cent, O'Bryant owes taxes on his lucky break.

He said he would have to take out a $500,000 mortgage just to pay the state and federal tax bills. Instead, the Texas police supervisor will put the dream home up for sale.

O'Bryant hopes his family will at least spend a vacation week in the house before the new owner takes over.

[chance33_98]

Insane.

[Goldi-Lox]

The People's Republic Of Maryland does not allow common citizens to prosper. Only the Elite Government Bureaucrats.

[VA Advogado]

Why does the title say sales tax? Home sales are not taxed by the feds or any state that I know of.

[RightOnline]

Since when is there a sales tax applied to a home??? Now, Federal / State taxes on the home as "income", I can see (hate it, but that's reality), but a sales tax???

[chance33_98]

That's how the headline was written...

[cinFLA]

Why does the title say sales tax? Home sales are not taxed by the feds or any state that I know of.

It does not say sales tax; only "tax". It is income tax we all have to pay.

[chnsmok]

Home sales are taxed in Washington state.

[JavaTheHutt]

$500,000 in taxes? Ouch!

[spectre]

Good point. I assume the article meant county real estate taxes, which would probably cost a bunch on a million dollar house in MD.

[RightOnline]

I believe ya............I'm taking my potshot at the author here. Pi$$-poor editing, in other words.

[RedBloodedAmerican]

Well, see....that's why you should vote for Keyes. He wants to institute a National Sales Tax.

[justlurking]

Since when is there a sales tax applied to a home???

A poorly written article by a clueless journalist. Why do you expect anything better?

Yes, the market value of the home is considered regular income. At $1 mil, that would put him into the top tax brackets for both federal and state income taxes -- 50% (overall) is about right.

But, he will net about $500K. That will buy him a very nice home anywhere in Texas -- probably even better than the one he sold in Maryland. And the really nice part is that he doesn't have to live in Maryland.

[VA Advogado]

It does not say sales tax; only "tax". It is income tax we all have to pay.

"Man Wins Free Dream Home, Can't Afford Sales Tax"

I'm sorry. I thought sales tax meant sales tax.

[Ditter]

He couldn't afford the electric bills either.

[Texas Gal]

They need to build those dream houses in cheaper places...taxes on houses are expensive. (It would be better if the taxes were less, though).

[chnsmok]

http://dor.wa.gov/Docs/Reports /2002/Tax_Reference_2002/REET. pdf
When you sell your home you pay. Sucks. Of couse, no income tax! Yet.

[VA Advogado]

Home sales are taxed in Washington state.

But I'm sure not at the general sales tax rate that other sales are subject too. They probably have some sort of 'transfer' tax.

[Willie Green]

It does not say sales tax; only "tax". It is income tax we all have to pay

If the NRST flying monkeys get their way, it'll be a sales tax.

---

Posing as "tax reform", the NRST (HR 2525) also represents a "land grab" where business interests are favored over individuals purchasing for their own use:

• A family purchasing their own new home for $200,000 pays NRST at a tax-included 23% rate. This means that of the $200,000 paid, $154,000 goes to the seller, and the Gov't receives $46,000 in tax.

• A landlord/investor can exploit the business exemption of NRST and purchase the same new single family dwelling tax free as a rental investment for only $154,000. Tenants pay NRST on rent and Landlords act as tax collectors for the government

• The $154,000 vs. $200,000 purchase price advantage that landlord/investors enjoy over individual personal homebuyers can be expressed two ways:
  • Landlord/investors enjoy a 23% discount compared to the individual personal home buyer.

  • Individual personal home buyers must pay 29.87% more than landlord/investors.

This a significant inequity between individuals trying to buy their own new homes and landord/investors looking to buy the same single family dwelling as a rental investment. This disparity has long term implications affecting the distribution of private property. The American tradition favoring individual property rights is reversed. The NRST would discourage individual "consumption" of real property.

"... legislators cannot invent too many devices for subdividing property, only taking care to let their subdivisions go hand in hand with the natural affections of the human mind. The descent of property of every kind therefore to all the children,...

But it is not too soon to provide by every possible means that as few as possible shall be without a little portion of land. The small landholders are the most precious part of a state."

-- Thomas Jefferson to James Madison, Oct. 28, 1785 -- PROPERTY AND NATURAL RIGHT

---

"A home is NOT an investment, W/G, but merely a place to live."

Posted on 03/26/2001 16:27:50 PST by pigdog

To: pigdog, Willie Green

It's amazing how many people view a home as an "asset," as well. It's a frickin' LIABILITY.

90 Posted on 06/29/2001 09:45:01 PDT by Poohbah

[VA Advogado]

Well, see....that's why you should vote for Keyes. He wants to institute a National Sales Tax.

LOL I don't know which is more unlikely - Keyes being elected president, or me willing a million dollar home. :) At least I can say I've never entered such a drawing.

[BlessingInDisguise]

Nowadays they apply a massive amount of taxes when you win ANYTHING. I don't think it's just sales taxes. You know when those publisher's clearing house winners win $100 million they've really only won about $40 million after taxes.