And, just like that, the Republican tax reform bill has passed both houses in Congress and is on the way to the President for signature.
The National Association of Realtors worked hard to improve the bill from its original version. Here’s some of what they did. (The following message has been quoted/edited for clarity from an email from NAR).
The new tax regime will fundamentally alter the benefits of homeownership by nullifying incentives for individuals and families while keeping those incentives in place for large institutional investors. That should concern any middle-class family looking to claim their piece of the American Dream.
Although the final tax reform bill is far from perfect, it is significantly better for homeowners than previous versions…
Last-minute changes to the bill include the following improvements:
• Capital gains exclusion. In a huge win for current and prospective homeowners, current law is left in place on the capital gains exclusion of $250,000 for an individual and $500,000 for married couples on the sale of a home. Both the House and the Senate had sought to make it much harder to qualify for the exclusion.
• Mortgage interest deduction. The maximum mortgage amount for households deducting their mortgage interest has been decreased to $750,000 from the current $1 million limit. The House bill sought a reduction to $500,000.
• State and local tax deductions. Both property taxes and state and local income taxes remain deductible, although with a combined limit of $10,000. Both the House and Senate bills sought to eliminate the state and local income tax deduction altogether.
Next steps
Enactment of the bill does not end NAR’s effort to reduce the negative impact on homeowners. “REALTORS®’ work on tax issues will continue,” says Mendenhall, “and we look forward to joining members of Congress from both sides of the rotunda on that endeavor.”
Access full details of the bill as it relates to housing and the real estate profession here.
So NAR is on the ball and their efforts saved this bill from having far worse consequences on housing. Support your local dues-paying Realtor today.
JN Wilkie | Real Estate Broker 