The silver state. [volume] (Winnemucca, Nev.) 1909-1925, 1911-01-24
PROPOSED Change
IN REVENUE LAWS

For years the problem presented by
the attempt to equitably tax mort
cages in Nevada has been a puzzler
for the legislatures and battling to the
assessors and collectors of taxes, but
at this session Assemblyman w. D..
Jones has an act drafted which is de-
signed to solve the difficulty and
promises to afford common sense ave-
nue. of relief.
The law proposed is one which is
designed to actually succeed in taxing
the holder of the mortgage for the
value of the mortgage and at the same
time tax the equitable owner of the
subject matter of the mortgage, the
land, for the value of the land less
the amount of the mortgage. In other
words the land owner will not be re-
quired to pay more than he really owes
as his share of the taxes.
Under the present law there are
many difficulties. The law ostensibly
is one for the taxation of mortgages
and it does tax mortgages where the
holder of the mortgage resides in this
state, but when the holder resides out
side he is not compelled to pay a tax.
The trouble is that after the mortgage
is taxed, the man who carries the bur
den is still required to pay taxes on
the assessed value of the land just the
same as if he had no mortgage to pay.
In addition to this, in practice it is
almost universally the custom that the
,ho nd nsu q
mortgage on his land, is forced by
necessity to agree to pay the taxes on
the mortgage This latter is, of course,
a matter, Of private agreement which
cannot be interfered with, but the con-
ditions can be changed so that the
burden will not fall so heavily.
AS an example, Judge Jones says
that at the present if man buys
for $4,000 after some nego-
that is apt to represent the
real value of the land. If he pays
So 900 down and gives the grantor
mortgage for the other $4,000, under
the present law, he must not only pay
taxes on the land for 100000, but he
must paw taxes on the mortgage for
So 900 That is how it works out.
Under the proposed law, under
similar circumstances the owner would
have to pay taxes only on $4,000
which represents his interest in the
while the holder of the mort
gage would have to pay taxes on, the
other $4,000 represented by the mort
gage.
Under the present condition it is
if much taxes are paid on
actual rtgages. Many mortgages
are so in effect but through fiction,
escape taxation. The man who would
borrow money goes through the form
Of selling the property for the amount
borrowed. giving a straight deed with
out condition. He records that. Then
be enters into private agreement
he is to receive deed back
when he repays the borrowed money.
This agreement is not recorded and
from the records the whole transac-
ton appears to be a straight sale. In
this way the mortgage tax is evaded.
1t is believed the act proposed by
Judge Jones will meet with favor. 1t
is based on acts in force elsewhere
which have proved adequate.-Reno
Journal.
While the bill referred to above was
no doubt introduced with the object
IF more equitable distribution of the
burden of taxation, it is doubtful if it
will have the desired effect. California
mas had a similar law on its statute
books for many years, and its only
practical effect seems to be to burden
offices with an endless
amount of work in apportioning taxes
netween mortgagors and mortgages.
Whenever a man applies to money
ender for a loan on his California
property, he is asked full interest and
enough additional to cover the taxes.
IN San Francisco real estate mort
cages draw from 7 to 10 per cent inter
,st, while in cities of the middle west,
IN the same classes of property, loans