Big TAX problem for House Corps

[EE-BO]

No doubt- it is a scary cost.

For any non-UT folks reading this- it is important to note that West Campus has always been very expensive. When a fraternity buys a large house on a decent sized piece of land, it is almost always necessary to raise the entire purchase price since it is not economically feasible to carry a mortgage. This is not only true now- but it was true 20 years ago.

Guys living in the house paying rent are not paying off a mortgage- they are paying property taxes, maintenance, utilities and- sometimes- money towards a fund for periodic major renovations.

So a 400% jump in property taxes can easily double or triple the rent you would have to charge residents in a Greek house in West Campus. And good luck getting guys to pay $500-600 a month to share a bedroom and be in the house when that would be the going rate for your own room in a 2 bedroom apartment. This is what makes this whole situation scary.

Looking over your earlier posts Texas Sig- I like the idea of somehow aiming for relief under a different IRS tax setup if possible as you noted. There is legislation somewhere in Congress that could potentially allow capital donations to Greek organizations to be tax deductible. Do you see a way a positive outcome there could be used to our advantage in dealing with property tax?

I am a CPA, but not a tax expert- so I am not sure what kinds of property tax concessions, if any, are available to IRS-exempt organizations.

[grayback]

Originally Posted by EE-BO

So a 400% jump in property taxes can easily double or triple the rent you would have to charge residents in a Greek house in West Campus. And good luck getting guys to pay $500-600 a month to share a bedroom and be in the house when that would be the going rate for your own room in a 2 bedroom apartment. This is what makes this whole situation scary.

I am not so sure about that. If you divide our housing bill up over 9 months in the SAE house at SMU, we pay about 800 a month, not including meal plan. I wish we could own our own property, but as it is the school owns 51% and we own 49%, which means it is technically theirs. Police can come & go as they please, etc. etc. However, the school does take care of all the maintenance.