Tax Laws

By: Beth Ferester & Company | Published 01/10/2018

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On December 20th 2017, Congress approved some of the biggest changes that the US Tax Code has seen in the past thirty years.  Two days later, President Trump signed those changes into law.  The laws took effect on January 1st 2018 and, like everyone, we are trying to evaluate and understand how these laws will impact the housing market.  Below is a summary of our understanding of the tax law changes that will most directly impact the housing market.

 

1. Mortgage Interest Deduction 

Tax law through 2017 

You may deduct the interest you pay on mortgage debt up to $1 million ($500,000 if married filing separately) on your primary home and a second home. 

Tax law beginning in 2018 

For homes bought before Dec. 15, 2017, no change. But for homes bought Dec. 15, 2017, or later, you may deduct the interest you pay on mortgage debt up to $750,000 ($375,000 if married filing separately.  

 

2. Property Tax Deduction 

Tax law through 2017 

You may deduct the property taxes you pay on real estate you own without limit.

Tax law beginning in 2018 

You may deduct UP TO $10,000 ($5,000 if married and filing separately) for a combination of property taxes and either state and local income taxes or sales taxes 

 

3. Home Equity Deduction 

Tax law through 2017 

You may deduct interest on UP TO $100,000 of home equity debt ($50,000 if filing separately) 

Tax law beginning in 2018 

Eliminates the deduction for interest on home equity debt ...... to continue reading please click on http://www.ferester.com/tax-laws/

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