The New Tax Bill and Homeownship
The following gives the highlights of the entire tax bill. I have bolded/underlined/italicized those that apply to homeowners.
These officially took effect on January 1, 2018 - but you won't realize any of it until you file your taxes at the beginning of 2019.
General for all:
- An overall lowering of the tax
bracket rates, including the top tax bracket which falls from 39.6% to 37%
- Personal exemptions are
repealed
For
taxpayers who itemize deductions:
State and local income and real estate taxes are capped at $10,000
per year
- Home
mortgage interest from home equity loans will no longer be deductible
- Home
mortgage interest on new mortgages is only deductible to the extent of
$750,000 of acquisition indebtedness
- Charitable contributions of
cash can be deducted currently up to 60% of adjusted gross income (up from
50%)
- Miscellaneous itemized
deductions -- including unreimbursed employee business expenses,
tax return preparation and investment management fees -- are no longer
deductible
Also:
- Standard deduction for joint
taxpayers increases to $24,000
- Child tax credit expanded and
will be allowed at higher levels of income (phasing out beginning at
$400,000 of income in place of $110,000)
- Up to a 20% deduction for
income earned by "pass-though" businesses such as partnerships
and S corporations (subject to a bunch of limitations)
- Alternative Minimum Tax (AMT)
provisions are retained, but fewer people will be subjected to its reach
- Lifetime exemption from estate
and gift taxes double for 2018 - potentially allowing for a great deal of
planning to occur for those who haven't adequately protected their estate
or who can now take advantage of the higher limits
#taxes #newtaxbill #homeownership #taxdeduction #realestate #2018tax #mortgagededuction
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