Interesting! Are you wealthy? - sm Posted: Dec 14th, 2017 - 12:40 pm In Reply to: I guess we'll just have to wait and see - exactly who will and who
The linked article indicates that you'd need to be fairly well off to be paying that much property tax and mortgage interest in the first place. Don't forget they've also increased your standard deduction, so itemizing will no longer make sense for most households. It's a better deal and easier to just take the deduction.
If you're paying more than $10,000/yr in mortgage interest and property tax then you're significantly more wealthy than the average American home owner.
Average yearly mortgage interest: $5646
Source:
https://www.thesimpledollar.com/heres-how-much-the-average-american-pays-in-interest-each-year/
Average yearly property tax: $3296
Source:
https://www.usatoday.com/story/money/personalfinance/2017/04/16/comparing-average-property-taxes-all-50-states-and-dc/100314754/
Total those up and you get $8942 on average. That's not even taking into account the additional $12,000 you're getting from the increased standard deduction.
How rich are you that your property taxes and mortgage interest are more than $22,000/yr? Hint: Read the linked article below.
Oh I'll just tell you! You need to be in the top 5% of earners to be hurt by this.
Here's a rather long quote from the article in the link below which confirms the averages above:
"If the deduction is retained in the manner proposed by House leaders, nearly three-fourths of households claiming the property tax deduction today would cease to do so. Specifically, the number of tax returns claiming property tax deductions would fall from 40.4 to 11.6 million in 2018—a decline of 71 percent.
One reason for this decline is that the increased standard deduction (up from $13,000 to $24,400 for married couples) would make claiming itemized deductions of any type utterly worthless for many taxpayers. For some, the higher standard deduction amount could reduce taxes overall—though much of that impact would be blunted by the loss of personal exemptions under the plan.
But another significant reason for the surprisingly limited impact of retaining just the property tax deduction is that very few households will have sufficient amounts of the remaining itemized deductions (e.g., mortgage interest, property taxes, and charitable contributions) to make claiming any of these deductions worthwhile."
I haven't heard anything about the home business deductions, so you may be right about that.
LINK/URL: Interesting! Are you wealthy?
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