Taxation Without Representation?

 Posted by at 7:44 am
Oct 292011

When it comes to property taxes, I rarely hear from people who do not think they pay enough. At a town meeting once lots of people were complaining about their assessed value. “There’s no way it’s worth that much!!” I couldn’t help but suggest that I wondered if they’d have that same perspective if they had called me because they needed to list it for sale.

I suppose there’s an interesting discussion to be had regarding the difference between assessed value (for tax purposes), appraised value (for mortgage purposes), and market value (for listing and sales purposes). But for today let’s touch on one aspect of property taxes–with the understanding that I am not the expert or final authority. Questions should be addressed to your local assessor or tax collector.

One area where we have some ability to “control” our taxes is in regards to vehicles such as campers or tractors. Many out of state purchasers are surprised when they get their first tax bill and discover it includes an assessment for the camper they left parked there. “I thought if it had wheels…”

Here’s the deal, as explained to me by one former tax assessor.

If you make the camper immovable (take the wheels off, build an enclosure around it), it can become part of your assessment and property tax bill—for tax purposes it becomes real estate.

 If the camper is “movable” there are two possibilities:

  • If it’s registered (in any state) it would not be taxable as personal property. (If registered in out of state you’d need to provide a copy of the registration to the assessor or have it visible in the window.) Note that if it’s registered in Maine you will pay excise tax. This gives rise to the observation that taxes are inevitable.
  • If it’s not registered it will be taxable as personal property. (Although a lot of times that doesn’t happen because the assessor hasn’t been to the property or otherwise noticed—they can, however, go back and collect those taxes for some period of time.)

 A lot Mainers “shop” those two possibilities to determine which is cheaper since if it’s registered you will pay an excise tax every year. The only way to do that is to ask the town tax collector for both amounts.

The problem with the whole complicated scenario is that enforcement really varies from town to town—and some Mainers can get very creative when it comes to avoiding taxes. I recall complaining to a fellow citizen about needing to register several trailers. He looked at me as if I’d grown a second head and said, “What the heck are you doing that for? All you have to do is register one and then keep switching the plate!”

He did not, of course, add “Just don’t get caught.” I suspect he’d been doing that for so many years he was sure it was proper procedure.