Noteworthy changes from the Tax Cuts and Jobs Act affecting individual homeowners.
Questions and concerns continue to arise as taxpayers wade their way through the new tax law. One of the areas impacted by the Tax Cuts and Jobs Act of 2017 is the changes made to the real estate industry, specifically for homeowners.
There are many substantial changes in deductions for homeowners, but arguably, one of the more troubling changes to recognize, is the limitation on the amount of interest that a homeowner may deduct in determining taxable income.
The new law changes the limit to $750,000 for a personal residence as well as second or vacation home combined. For loans taken prior to December 15, 2017, the new law grandfathers the $1 million limit. This new limitation of $750,000 may affect a significant number of taxpayers with vacation residences throughout the country. Even more troubling is repeal of the deductions for Home Equity Loans and Home Equity Lines of Credit (HELOCs).
These topics and more are discussed in a recent podcast with John Lyons, an Officer in GSG’s Tax Department. John breaks down the impact and changes to the new tax law for homeowners.
The following topics are discussed:
- Interest a homeowner may deduct in determining taxable income
- Deducting the interest on home equity loans
- Real estate tax deduction limits
- Moving expense deduction
- Personal casualty loss
- Gain on the sale of a personal residence
- Converting a rental property into a personal residence
- Converting a personal residence into a rental property
The new tax law involves substantial changes, many of which apply directly to homeowners. Our team of tax professionals are here to identify and provide clarity to any confusion you may have when trying to determine how the new tax law will affect you.
To learn more about the topics discussed, or to answer any questions you may have regarding the new tax law, please contact our tax professionals today.Categories: Tax, Real Estate