|Answers to 3 Major Concerns of Real Estate Taxes Hitting Your WalletAccuweather in Lake Arrowhead December 18, 2017 Issue 288|
THE MOST ACCURATE NEWS FROM REAL ESTATE EXPERTS ON THIS DATE.
1. Mortgage Interest Deduction
There was concern that the mortgage interest deduction (MID) would be eliminated. That didn’t happen.
However, the bill has made the following changes:
2. State and Local Taxes (SALT)
There was concern that the state and local tax deduction (which includes property taxes) would be eliminated. That didn’t happen.
The final bill allows an itemized deduction of up to $10,000 for the total of state and local property taxes and income or sales taxes.
3. Exclusion of gain on sale of a principal residence
There was concern that owners would now need to live in their house for at least 5 out of the last 8 years to claim this exemption. Under the former tax framework, a typical owner, who has lived in their house for at least 2 years out of the last 5 years, would pay nothing in capital gain taxes if they sell the house.
No change. The new code will remain the same as the old.
Other links that might help:
TAX CUTS AND JOBS ACT The final proposal put up for vote by the Conference Committee.
H.R. 1 – The Tax Cuts and Jobs Act
The National Association of Realtors‘ (NAR) Issue Brief. More information on other aspects of the bill.
What will be the impact on the real estate market?
Please read disclaimers at the bottom of this page.
The most thorough analysis of how tax reform will affect the housing market has come from Capital Economics. Here are some highlights:
Here is their full analysis (7 pages): US HOUSING MARKET FOCUS: Buying still better than renting in the long run
Calculated Risk‘s Bill McBride weighed in on the subject. Here are some highlights:
Here is his full analysis: A few comments: Housing and Policy
Mark Zandi of Moody’s Analytics had a more negative opinion. Here are the highlights:
Coldwell Banker Sky Ridge Realty, Lake Arrowhead CA, 92352-1089 Since 1982.