New Yorkers Fleeing State

Given the bleak outlook of the national, state & local economies, I am reconsidering whether to buy an apt.
No doubt all taxes will rise: income (fed, state, local) & property tax, which will force maintenance & cc to rise. As the USD sinks, cost of living will rise. Does it make sense to commit a huge chunk of money when one knows that cost of ownership & living is only going up?

The alternative is to rent or leave the tri-state area, since NJ & Conn aren't much cheaper.

Agree? disagree? thoughts?

So this is not another buy or rent thread, it's a buy or rent or leave thread?

Also discussed here earlier today. Much ado about nothing.

http://streeteasy.com/nyc/talk/discussion/27734-ny-state-and-city-population-decrease

Or at least much ado about not very much

dwell - there's another way to look at it

yes, costs of owning are going up but so are costs of renting - i would say that the rental market is increasing/rising at a much faster clip than is the ownership/real estate market - any increased ownership costs + increased demand will certainly continue to drive rental prices up

AND real estate tends to track inflation so at least real estate can hedge against that and you'd own at historically low rates

it just depends on how you look at it

@dwell I agree. Either way, it looks like costs will rip everybody a new one. So if you can, why not OWN something? Otherwise, you're just throwing $$ away.

buy a rent abated building, if you buy.....people can laugh but it's real money you are saving...the longer the better

sorry meant to say "tax abated"

dwell: If you see something you like and can afford, buy it.

Even if you aren't able to work from home,or must/want to stay in the U.S.A. -- this is still N.Y.C.

I have a good deal going on with my friend from Italy.
She would rather not live in Manhattan and prefers Brooklyn , so I will buy the apartment that she likes the best there. Because she will be living in it for almost the entire year while I live at her home in Tuscany.

I could have done that with friends in Barcelona.
If you buy, so can you.

I can refer you to several friends there who would love to make the same deal.

I leave next week for a few months in Europe and Italy.
I'm gonna cruise the Med and stop in Eze. Maybe I'll run into perfitz (or was it prefix?).

First stop: Barcelona and dinner at TICKETS.

I have to go to the bank tomorrow and get some ergos. What's the exchange rate for ergos these days?
(That lady in Lucy's former apartment doesn't like me. But she said that I'm better than sidelinesitter.
What a relief! I prefer Fred and Ethel anyway. ;) ).

Truth - don't exchange money here - just do it at the airport with your bank ATM card when you get off.

Sounds like a fabulous few months are coming up for you. Have a wonderful time!

ph41: Thanks, I know. That's what I always do.

I was just making a reference to some earlier silly comments that went away. ("Ergos" was not a typo for Euros.)

Ya gotta be fast on these threads these days.

Thanks, guys. I appreciate everything everyone said. My main fear is the income tax. As a Manhattan resident, I know I'm paying over 50% of my income in fed, state & local income tax & the thought of it going higher scares the sheet out of me. Where does it end? It doesn't, it just goes up & up until I'm keeping about 20% of what I earn?

Thus, my fear of plunking down a huge chunk of cash & be wedded to an illiquid asset that may be hard to get out of when I chose to do so. RE can be ez to get into, but hard to get out of.

Now we have US debt equalling US GDP & our gov just keeps racking up debt. No one has the guts to make meaningful cuts. It's bleak.

On the other hand, I'm a NYer. No place else I'd want to be.

But, as Urbandigs has said, the quality & quantity of current inventory is thin.

So, I'll just watch & wait.

Truth, have a great time. Sounds s'wonderful. I'm drooling.

Thanks again, everyone.

"I know I'm paying over 50% of my income in fed, state & local income tax..."

Get a better accountant.

"I know I'm paying over 50% of my income in fed, state & local income tax"

No one even pays 50% as a marginal rate. It's literally impossible to have a 50% effective tax rate.

"As a Manhattan resident, I know I'm paying over 50% of my income in fed, state & local income tax."

No your not.

Sunday & jordyn:

I look at my AGI, then I have payments due on April 15th, then I have estimated taxes during the year: The April 15th payments & the sum of the estimated tax payments are over 50% of my AGI.

Am I miscalculating or misundertsanding?

Re: "I know I'm paying over 50% of my income in fed, state & local income tax"

I just heard a tea bagger say ALMOST THE SAME THING the other day (except her number was 60%!)

TOTAL BS! Go to the data:

IRS data from IRS.gov (rounded a bit) and NY data from NY state/city tax sites

28% bracket (mp $130,000) taxes % AGI = 17%,SS= 5.2%;NYS = 7%; NYC = 3.5% TOTAL = 33%!
33% bracket (mp $275,000) taxes % AGI = 21% SS= 3.4%; NYS = 8%; NYC = 3.5% TOTAL = 36%!
35% bracket (mp $500,000) taxes % AGI = 26% SS= 2.7% NYS = 8%; NYC = 3.5% TOTAL = 40%!

So go ahead and bitch if you want if you make a half mil a year and pay 40% in total taxes. But don't LIE to make your point.

West34,
I'm not a troll or looking for trouble. I see what I'm paying. People are disagreeing with me & that's fine. But, show me where I'm wrong. Maybe I do need a new CPA, but I've spoken to other CPAs & they tell me that's what it is.

You cite the brackets, but from what I understand, the Alternative Minium Tax slants the brackets.

you're lying, dwell, quite simply

could be any number of things, but likely your income aint even close to top bracket, as with most teabagger drones

I'd be thrilled if I was only paying 40%!

get an accountant. immediately.

dwell: Actually, I take it back. If you're self-employed and in the 35% tax bracket you can end up with a slightly-over 50% marginal rate since you'd have to pay the New York "millionaire's tax" as well as double Medicare tax. But I still don't think it's possible to end up with a 50% effective rate.

As for your methodology, you're combining 2010 taxes and 2011 taxes. I don't know enough about your tax situation to say why your methodology might be flawed. The most reasonable way to figure out your total effective rate in 2010 would be to look at your total income from all sources and then add up your total federal, state and SS/medicare payments and see what they sum up to. Divide and you figure out your effective tax rate.

My last comment was dumb. Obviously if you can have a >50% marginal rate you can eventually end up with a >50% effective rate. But I think you'd need several million dollars of self-employment income for that to happen.

And I suspect as a self-employed filer, playing really fast and loose with your reported income is assumed. Exactly how far below your ACTUAL income is your AGI?

We have a definition problem here.

dwell, since you're paying estimated taxes, I assume you've got some kind of Schedule C/freelance business thing going on. But remember that your AGI is your income AFTER you've done your Schedule C, which means your income AFTER business expenses.

If you looked simply at the taxes you pay over your non-adjusted gross income (that is, over every dollar of revenue that comes in) it shouldn't hit 50%.

ali r.

Thanks, jordyn.

I don't have "several million dollars of self-employment income", but I do have self employment income.

"you're combining 2010 taxes and 2011 taxes": maybe that is not the right way of looking at it, but, I'm looking at the cash-flow reality: the checks I write.

listen to yourself.

you state that you pay 50% in taxes. everyone points out that isn't possible. a reasonable question is posed about the methodology you are using to determine this.

you reply that you don't care. you know what you know.

sounds like the us congress at work. don't bore me with facts or reality.

also -- Soc. Security taxes are doubled for freelancers, so that bite is 12% on the first $100K, not 6%.

ali

Thanks, ali. I have to look at the numbers again. I wish there was an easier way of figuring this out, especially for the self employed.

I believe the alternative minimum tax skews the brackets. My CPA says the alternative minimum tax was originally for the very wealthy, but now it has sucked in the middle class.

"Soc. Security taxes are doubled for freelancers, so that bite is 12% on the first $100K, not 6%."
Thanks, ali, I didn't know that.

Can anyone recommend books or web sites to help me figure this out, so I'm not solely dependent on my CPA's word?

http://www.turbotax.com/lp/ty10/ppc/hp.jsp?priorityCode=4515800000&ven=gg&cid=ppc_gg_b_stan_us+ny_btt+nm+spc+ny&adid=9828234468&skw=turbo%20tax&kw=turbo%20tax

http://www.irs.gov/businesses/small/selfemployed/index.html#onlinelearningtools

West34, please do not post on this thread. Thank you.

Maybe this one will suit you better - www.businesstaxesforidiots.com

Maybe this one will suit you better - www.businesstaxesforidiots.com

I asked you nicely not to post here. Please have a minimum of civility & abide by my request. Thank you.

you kidding right? you launch some teabagger whine about an invented tax rate, get called on it, and then try to control who can post in response??

I'm going to have to agree with Wbuttocks on this one - at least the last 9 words.

It's fine that West34 doesn't agree with me & it's very possible I'm wrong (& I'd be thrilled if I am wrong & seems I am), BUT, he doesn't have to be so obnoxious. So, yeah, I don't want to hear from him.

I like that SE is graying out some really rude people, who just diminish the board. People say things on the Inet that they would never say to someone's face. Hopefully, that will change.

you may be wrong and you'd be thrilled if you were wrong but....

what?

huh?, do you even understand what you wrote?