Tax Day Is Almost upon Us!

Tax Day Is Almost upon Us!

Tax day is just a few weeks away, and the Tax Cuts and Jobs Act is now in effect, which means there are new requirements for homeowners. The media covered the changes in much detail in early 2018, and I wanted to share a few housing-related highlights with you as you get ready to file your taxes.
As you may know, the number of income tax brackets remains the same, but they include lower tax rates. Several itemized deductions, including moving expenses except with military households, interest on home equity loans unless used for home improvements, and more, have also been reduced or eliminated.
Here are a few other important changes to keep in mind.
  • Mortgage interest deductions are limited to a combined $750,000 of debt for both primary residences and second homes for any loans taken out after Dec. 14, 2017. Current homeowners with loans made before that date are grandfathered into the previous deduction, allowing a combined debt limit of up to $1 million.

  • State and local tax deductions are capped at a combined $10,000 – this includes state and local property, income, and sales taxes. Previously, these were fully tax deductible.

  • Capital gains tax exclusions remain the same when you sell your house. Married-joint filers can exclude up to $500,000 and single filers can exclude up to $250,000 when selling their primary home, as long as they’ve lived there two of the past five years.

The Tax Cuts and Jobs Act also brings changes to real estate investors, including new pass-through tax deductions and expanded expensing, among other potential benefits. Your tax advisor can provide you with specifics on all of these changes and how they apply to you.
As always, if you have any real estate-related questions, please feel free to contact me. I look forward to helping you with your future real estate needs.

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The team at Denise Ramey Real Estate has extensive experience in the local market in Central Virginia and the Charlottesville area, allowing you to enjoy a more simplified process. We handle everything in-house, from the first steps of your search through to the final details of the transaction. We leverage our extensive network to benefit buyers and sellers alike, ensuring that your transaction is as simple as possible.

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