On 2017-08-20 09:34, jbeattie wrote:
On Sunday, August 20, 2017 at 8:14:53 AM UTC-7,
wrote:
On Saturday, August 19, 2017 at 7:36:55 AM UTC-7, Joerg wrote:
On 2017-08-18 19:17, sms wrote:
[...]
I was talking to a CPA yesterday, and she was explaining what
is really wrong with California when it comes to small
businesses. It's how expensive it is to operate as an LLC, and
the dual taxation you're subjected to. The purpose of an LLC is
to put a wall between the businesses assets and the business
owner's personal assets. But the cost of operating as an LLC is
so high in California that she advises people to just operate
as a sole proprietorship and to buy a very large umbrella
insurance policy to protect their personal assets, because the
umbrella policy will cost a lot less than paying taxes as an
LLC. Jay would know more about this than I do!
That is exactly what people here are doing :-)
Others go a step further, packing it up and moving the business
out of state. Or they lose out against out of state businesses in
the marketplace. This also evidences itself in where my clients
are. A decade ago most were in California. Now most are in the
Houston area.
Wouldn't you think that taxation of rental properties would be
better tied to rents rather than property values?
When I've written the local paper that the business atmosphere is
driving business out of California the responses are that business
growth in California has never been higher. Yet even Elon Musk
built his battery plant in Nevada.
All we usually get in inflow is service-type business like it happened
much in the UK. That doesn't sustain real produced value, let alone export.
Property taxes are tied to rents in a way because property values for
multi-family are based on return. The value is rent-driven. A
beautiful building in a depressed rental market is worth less than a
falling-down slum in the Bay Area.
In California it is different. Property tax depends on the amount of
money the owner paid for the property, plus 2% increase every year from
then on. Until the property changes hands upon which the then paid
purchase prices becomes the determining factor.
Building a battery plant in Nevada makes sense. What's a little
heavy metal in the groundwater in a place where they were lighting
off nukes? Actually, apart from the regulatory landscape, its easier
preventing pollution in a desert because there are not the same
groundwater concerns, and dirt is cheap.
California has made a decision not to attract dirty businesses. Some
of these businesses, like coal export (a big issue around here) also
involve unpredictable markets and employers who come and go and leave
a big mess.
We also have "non-dirty" business leaving.
http://www.foxandhoundsdaily.com/201...ng-california/
--
Regards, Joerg
http://www.analogconsultants.com/