The Corner

IRS Rent Seekers

Many readers make this point:


I’m sure you’re getting lots of mail on the whole tax issue, so let me burden you with one more.

One email you posted included the fallacy that renters don’t pay property taxes.  The reality is that property taxes are built into the rent in what those of us in the commercial real estate business call a gross rent.  Gross rent includes the cost of renting, insuring and maintaining the property as well as paying the associated property taxes.  If there were no property taxes, the rent would be lower.  So renters do pay property tax but they do so indirectly through their landlords.

However, the issue of property taxes and sales taxes are beside the point as they do not go to the national government.  I also agree that FICA taxes should not in fact be considered taxes as they are technically premiums or contributions.  This leaves the income tax as the only significant national tax and it is fair to say that nearly half of Americans don’t pay national taxes.


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