He's a funny guy, that Mike Meena, so I just copied and pasted his comments.....it's amusing....here goes:
So the tax bill has been approved and it is not that bad, but it's not the end-all-be-all either. Here are some of the key points and how Real Estate will affect your taxes going forward:
- All along they were going to change the Capital Gain Exemption from 2 of the last 5 years to 5 of the last 8 years and they changed it back this week to 2 of the last 5 years. This means that you have to occupy your property for 2 of the last 5 years to get the $250,000.00 (if you are single) or $500,000.00 (married) Capital gain exemption.
- This is the biggest win for Homeowners, and the country. Real Estate is key to moving the economy forward and if they went to 5 years before you could sell, that would slow the economy immensely.
- There is a $12,000 personal Tax Exemption for individuals and $24,000.00 for couples.
- This will cause more people to file short form taxes and take that exemption instead of filing the long form. This may cause some people to say it is not worth buying, but I know I can convince them with numbers and the numbers don't lie and neither do I! If they file the short form then they will not be able to write off charitable contributions, which will definitely hurt charities!
- No more Interest deductions on a second home!
- This stinks, but that doesn't hurt the middle class and I get it!
- You can only write off $750,000.00 on all new mortgages taken after 12-15-2017.
- Again, this is not a middle class issue in 48 states. Sadly it is an issue here in California for the middle class, but they don't care about us because we have great weather!
- Property taxes and State income taxes can only be deducted up to $10,000.00.
- So you have Mello-Roos? That stinks! If you have a household income of $200,000.00 with the lower tax brackets and no state deduction aside from the 10k for property taxes then you would still save about $1800.00 in Federal taxes vs. last year!
- The worst part about these tax cuts is that they are temporary and Congress would have to vote to continue them in 8 years, which means that they will probably go back up.
- Is this where I say Yay? Or shocker?
Overall it will save most people money, but not everyone. I know that I will be changing a few things to lower my tax liability, but most W-2 Employees don't have the same ability to do that. I don't feel that the slight changes will have much effect on the Real Estate market or individual tax payers! I am bummed about quite a few things personally, but I will get by. However, I'll need your help and here is my Go Fund me account! Just kidding!