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Property taxes on unrealized gains?
Posted on 6/1/26 at 11:57 am
Posted on 6/1/26 at 11:57 am
The assessed value of my property increases so the property tax goes up with it.
But I haven’t sold the property and don’t plan to sell so I assume I am being taxed on unrealized gains?
But I haven’t sold the property and don’t plan to sell so I assume I am being taxed on unrealized gains?
13
Posted on 6/1/26 at 11:58 am to weagle1999
You're confusing property taxes with income/capital gains taxes.
Posted on 6/1/26 at 12:01 pm to weagle1999
quote:
But I haven’t sold the property and don’t plan to sell so I assume I am being taxed on unrealized gains?
No
Property tax = tax on the assessed value of your property at the time of assessment, not tax on the assessed value of the property on the day you bought it.
This post was edited on 6/1/26 at 12:02 pm
Posted on 6/1/26 at 12:02 pm to weagle1999
quote:
But I haven’t sold the property and don’t plan to sell so I assume I am being taxed on unrealized gains?
No. You are not being taxed on "unrealized gains". It's simply property tax. And it has no state or federal involvement.
Does the tax increase as the property is assessed higher? Yes. But the new tax is not a figure involving a prior basis as a tax on unrealized gains would be.
Posted on 6/1/26 at 12:02 pm to weagle1999
You NEVER own property. Welcome to America
Posted on 6/1/26 at 12:03 pm to CleverUserName
quote:
But the new tax is not a figure involving a prior basis
I think he's saying, effectively it sort of is really.
Posted on 6/1/26 at 12:04 pm to weagle1999
quote:
But I haven’t sold the property and don’t plan to sell so I assume I am being taxed on unrealized gains?
Yes that is exactly what is happening. The theoretical value of your house/property increasing doesnt actually give you any financial benefit, but you are taxed as of it does.
Posted on 6/1/26 at 12:06 pm to weagle1999
You're being taxed on an unrealized paper gain. Your property is worth more on paper, you haven't realized a single dime of profit because you haven't sold it, yet your tax bill went up anyway.
It feels deeply unfair and it's a massive pain point for homeowners but from a legal and structural standpoint, the government doesn't view property tax the same way it views income or capital gains taxes.
It feels deeply unfair and it's a massive pain point for homeowners but from a legal and structural standpoint, the government doesn't view property tax the same way it views income or capital gains taxes.
Posted on 6/1/26 at 12:09 pm to MMauler
quote:
You're confusing property taxes with income/capital gains taxes.
No he’s not. These people want to put UNrealized gains as a tax
Posted on 6/1/26 at 12:10 pm to Y.A. Tittle
It is much more akin to a wealth tax than a capital gains/unrealized gains tax. The value could only go down and you'd still owe a property tax on whatever the value is every year, even though it has never appreciated.
There is an argument with them that when the government assessment is done, then that value is "realized". I don't love property taxes to begin with, but I understand the argument around them and the ease of calculation for a tax to help fund local public services. I think there are better ways, but ultimately it is a fairly stable, non-liquid calculation basis tied to a specific area. However, the asset seizure that can come from not paying them I have a big issue with, but that is for the PT board.
There is an argument with them that when the government assessment is done, then that value is "realized". I don't love property taxes to begin with, but I understand the argument around them and the ease of calculation for a tax to help fund local public services. I think there are better ways, but ultimately it is a fairly stable, non-liquid calculation basis tied to a specific area. However, the asset seizure that can come from not paying them I have a big issue with, but that is for the PT board.
This post was edited on 6/1/26 at 12:13 pm
Posted on 6/1/26 at 12:11 pm to weagle1999
quote:
But I haven’t sold the property and don’t plan to sell so I assume I am being taxed on unrealized gains?
Wait until they come after your gains in your brokerage and 401K/IRA account. Then you will know about taxing unrealized gains.
Posted on 6/1/26 at 12:15 pm to ksayetiger
quote:
You NEVER own property
Correct. You can only lease property from the government; your annual property tax is the rent due.
Posted on 6/1/26 at 12:15 pm to BuckeyeGoon
Wait till the day those democrats start making a case that by paying assessed property taxes that you agree with the new values therefore you will owe capital gains taxes on it regardless if you sell or not
Posted on 6/1/26 at 12:18 pm to weagle1999
When housing prices went way up during Covid shortages and I knew so many people jumping for joy at all that value they gained.
Then I explained to them the downfall. Said their property taxes would go up. And then insurance costs would go up to cover the increased replacement housing values. Only then did they realize it was bad to go up so fast.
Also told them if they sell and rebuy another house, the next house would also be higher. And since realtors get paid on commission it was a big pay raise for them at least.
Was amazed watching them realize the extra costs that super housing inflation would cost
Then I explained to them the downfall. Said their property taxes would go up. And then insurance costs would go up to cover the increased replacement housing values. Only then did they realize it was bad to go up so fast.
Also told them if they sell and rebuy another house, the next house would also be higher. And since realtors get paid on commission it was a big pay raise for them at least.
Was amazed watching them realize the extra costs that super housing inflation would cost
Posted on 6/1/26 at 12:22 pm to idlewatcher
quote:
No he’s not. These people want to put UNrealized gains as a tax
He is though. A property tax is not an income tax. Capital gains taxes are income taxes.
Posted on 6/1/26 at 12:26 pm to Mo Jeaux
No one is saying property taxes are literally titled an unrealized gains tax. The point is they are functionally the same thing.
Posted on 6/1/26 at 12:28 pm to BuckeyeGoon
quote:
No one is saying property taxes are literally titled an unrealized gains tax. The point is they are functionally the same thing.
They aren't though. I think that distinction needs to be made. You could never have a single gain on a property and would get taxed every single year. They are functionally very different.
This post was edited on 6/1/26 at 12:29 pm
Posted on 6/1/26 at 12:29 pm to BuckeyeGoon
quote:
The theoretical value of your house/property increasing doesnt actually give you any financial benefit
It certainly does.
Posted on 6/1/26 at 12:29 pm to BuckeyeGoon
Nothing sets the Acktuchally Crew off quicker than a metaphoric point attempted here 
Posted on 6/1/26 at 12:31 pm to GoCrazyAuburn
quote:
They aren't though. I think that distinction needs to be made. You could never have a single gain on a property and would get taxed every single year. They are functionally very different.
Right. Otherwise, this is just a thread to bitch about all taxes, which I’m fine with. I hate all taxes, and that hatred grows every year.
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