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TAX TALES: When Her Property Taxes Got Tough, She Got Going

FROM <a href=""><u><span style="color: #810081">THESTREET.COM</span></u></a>: Property taxes too high? Find a location that offers your family a better deal.

FROM THESTREET.COM: Property taxes too high? Find a location that offers your family a better deal.

The benefits might be about more than money.

When property taxes for my New Jersey home surpassed my mortgage payment, I knew I'd need more than a bullhorn to let legislators know how I really felt.

I sent an even louder message to the Statehouse in Trenton, where politicians talk incessantly about the property-tax crisis yet make no meaningful reforms.

I voted with my feet.

Last summer, I moved my family to Pennsylvania. I no longer feel hopeless about out-of-control property taxes that I once feared would ultimately threaten my family's financial well-being.

New Jersey was home to my family for 15 years. I never expected to pay bargain-basement property taxes while living in the Garden State. But in recent years, my tax bill -- and those of many other New Jerseyans -- got out of hand. Taxes on my home increased by 41% during our seven years of ownership.

Each year, our tax bill notched up between $500 and $1,200. Taking just one hit that size is difficult to stomach.

As I struggled to get back to work after caring for my young children for several years, I became even more resentful about turning my hard-earned income over to our township each quarter. What would my taxes be, I wondered, when my youngest child finished high school in 2020? The damage could have easily exceeded $20,000 by then.

Millions of dollars in commercial taxes from behemoth companies in New Jersey such as Bristol-Myers-Squibb (BMY) , Johnson & Johnson (JNJ) and Merrill Lynch (MER) seemed to have little impact on my family's bottom line.

Property tax misery is a national problem.

Florida Tax Watch, a nonprofit, nonpartisan research institute, estimates that property tax levies in the state more than doubled between 1997 and 2006.

Last week, Florida residents approved an amendment to the state's constitution that is intended to relieve skyrocketing property taxes.

It's also aimed at making it easier for longtime residents to transfer existing property tax breaks when moving to another home within the state. Until now, a peculiarity in the law imposed higher property taxes on longtime residents who relocated -- even those buying a smaller, less expensive home. The homestead rebate -- a reduction in a home's assessed valuation -- also doubled to $50,000 from $25,000.

The Chicago Tribune reported that property taxes in the Meridian-Kessler neighborhood of Indianapolis jumped 35%. One homeowner's bill escalated to $35,302 from $5,200 five years ago.

Last month, New York Gov. Eliot Spitzer met with residents and business leaders from Long Island, N.Y., another mecca for sky-high property taxes, to discuss the possibility of setting a cap.

In 2006, New Jersey earned the dubious distinction as the state with the highest property taxes per capita in the nation, according to the U.S. Census Bureau and calculations by the Tax Foundation, a nonpartisan tax-research group in Washington, D.C.

There are multiple reasons for this "honor" -- and they seemed unfixable to me. New Jersey is one of the nation's geographically smallest states, yet it has 566 municipalities, whose individual governments often replicate costly services such as police, fire protection, public maintenance and -- the big-ticket item -- school districts. A history of chronic fiscal mismanagement and widespread political corruption also means that millions of hard-earned taxpayer dollars go to waste.

Politicians at all levels of government talked about property tax reform and task forces for years. But while I waited, my tax bill kept ticking upward. I rarely heard of anyone in our town getting away with paying less than $10,000 and knew of families whose bills eclipsed $20,000.

I'd often laugh with the local tax collector about my fantasy move to a place where my annual property taxes would be equivalent to the $3,000 I shelled out each quarter about two years ago. "Where are you gonna go?" he once asked, as if there were no other place on earth.

I may have chuckled in response. But I wasn't joking.

Thinking about moving, and actually taking the plunge, however, are two very different thought processes. A company that offers a transfer to a better job makes the decision for you. But uprooting three children from a comfortable house on a cul de sac because there may be a better deal -- and even a better life -- someplace else, is a tough call. We stayed put for about three years after the first thoughts about moving crept into our heads. My children were happy in our neighborhood and the area was still our home.

However, two converging factors finally precipitated our big decision -- a son who was about to start middle school and a $14,200 tax bill.

Sometimes, you just have to draw a line in the sand. I drew mine at $1,183 per month on property taxes.

No more. No way.

I now live only 30 minutes from my old home, but it could just as well be a world away. My taxes are now $7,000 per year less than the $15,000 tax bill I passed along to my buyers at settlement last summer (and they're even lower further west in Pennsylvania).

I'm also enjoying the advantage of a vastly improved quality of life. The Delaware River is within walking distance of our home. Lower population density means I'm less likely to stress over not finding a parking space at the supermarket.

Surprisingly, I also notice retirement-age people in my neighborhood and on the nearby walking trails -- an uncommon sight in my former high-tax state.

My friends often ask, "Are the schools good?" Yes -- unequivocally. High taxes don't necessarily guarantee better schools -- only a greater percentage of your money that government is more likely to waste.

Not everyone can make the same decision I did for my family. A job or business may keep you tethered to a high property tax location, at least for now.

But property tax reform is attainable for just about everyone else. Just move elsewhere.