New Tax Laws? (by Livethedream [AZ]) Dec 19, 2017 6:48 PM|
New Tax Laws? (by Homer [TX]) Dec 19, 2017 7:01 PM
New Tax Laws? (by Deanna [TX]) Dec 19, 2017 7:06 PM
New Tax Laws? (by RathdrumGal [ID]) Dec 19, 2017 9:59 PM
New Tax Laws? (by Smokowna [MD]) Dec 20, 2017 3:14 AM
New Tax Laws? (by myob [GA]) Dec 20, 2017 4:40 AM
New Tax Laws? (by nhsailmaker [NH]) Dec 20, 2017 4:42 AM
New Tax Laws? (by John... [MI]) Dec 20, 2017 5:28 AM
New Tax Laws? (by AllyM [NJ]) Dec 20, 2017 5:40 AM
New Tax Laws? (by Beth [WI]) Dec 20, 2017 5:49 AM
New Tax Laws? (by Beth [WI]) Dec 20, 2017 5:54 AM
New Tax Laws? (by myob [GA]) Dec 20, 2017 6:13 AM
New Tax Laws? (by LindaJ [NY]) Dec 20, 2017 6:33 AM
New Tax Laws? (by Deanna [TX]) Dec 20, 2017 6:34 AM
New Tax Laws? (by RB [MI]) Dec 20, 2017 7:14 AM
New Tax Laws? (by RentsDue [MA]) Dec 20, 2017 7:15 AM
New Tax Laws? (by Pmh [TX]) Dec 20, 2017 8:19 AM
New Tax Laws? (by LindaJ [NY]) Dec 20, 2017 8:44 AM
New Tax Laws? (by Emily [TX]) Dec 20, 2017 1:19 PM
New Tax Laws? (by Dan [NY]) Dec 20, 2017 6:22 PM
New Tax Laws? (by GKARL [PA]) Dec 20, 2017 7:42 PM
New Tax Laws? (by Dan [NY]) Dec 20, 2017 7:56 PM
New Tax Laws? (by Kyle [IN]) Dec 20, 2017 8:41 PM
New Tax Laws? (by GKARL [PA]) Dec 21, 2017 1:37 AM
New Tax Laws? (by GKARL [PA]) Dec 21, 2017 1:54 AM
New Tax Laws? (by NE [PA]) Dec 21, 2017 5:09 AM
New Tax Laws? (by John... [MI]) Dec 21, 2017 6:37 AM
New Tax Laws? (by John... [MI]) Dec 21, 2017 6:38 AM
New Tax Laws? (by Emily [TX]) Dec 21, 2017 7:35 AM
New Tax Laws? (by GKARL [PA]) Dec 21, 2017 2:51 PM
New Tax Laws? (by GKARL [PA]) Dec 21, 2017 3:04 PM
New Tax Laws? (by nhsailmaker [NH]) Dec 21, 2017 3:23 PM
New Tax Laws? (by razorback_tim [AR]) Dec 21, 2017 3:38 PM
New Tax Laws? (by LisaFL [FL]) Dec 21, 2017 4:05 PM
New Tax Laws? (by GKARL [PA]) Dec 21, 2017 4:13 PM
New Tax Laws? (by Jeff S [MI]) Dec 25, 2017 6:39 AM
New Tax Laws? (by Chris [CT]) Dec 25, 2017 7:37 AM
New Tax Laws? (by Dan [NY]) Dec 25, 2017 9:45 AM
New Tax Laws? (by Livethedream [AZ]) Posted on: Dec 19, 2017 6:48 PM
How will these new tax laws affect you? The $10,000 state tax limit is likely to hurt investors, or anyone buying large ticket items. If you have 10 properties, and pay $10,000 in property tax, then pay $5,000 in sales taxes, and buy a new cheap motor home for $150,000, with say a $10,000 sales tax. You used to be able to write off the whole $25,000. Now only $10,000, the rest we eat.
I see a stifiling of big ticket item sales, and an even greater exodus of wealthy to no tax states. I'm so glad we got out of CA, which we left because the insane taxes made working and flipping unprofitable. It will be worse now. And states like AZ aren't much better.
Oh, and get this. In my state there is a move to collect local sales tax on anything you spend in other states. And are trying to get access to credit card records to ensure compliance. Big Brother is moving fast folks. --47.216.xx.xxx
New Tax Laws? (by Homer [TX]) Posted on: Dec 19, 2017 7:01 PM
I, like everyone else have not read the tax bill. I wouid suspect though that the 10,000 deduction wouid only be on personal houses, not on investment houses. If it is, I may as well give everything away. This year I am paying near 100k on prop tax, but only 6000 of that is on my personal home. --75.141.xxx.xxx
New Tax Laws? (by Deanna [TX]) Posted on: Dec 19, 2017 7:06 PM
I haven't done my own taxes since my 1040-EZ days, but I was under the impression the property tax deduction was previously only applicable to those who itemized, rather than taking the standard deduction? What did the "standard deduction" used to be? And was it the "big" "standard deduction", that everyone's talking about how it's doubled in the future, or just "a" "standard deduction"?
I'm happy living in a no-income-tax state. I firmly believe that states shouldn't be interchangeable. They ought to embrace/prioritize different things, and people ought to be able to find one that embraces the things they embrace/prioritize, too. But when everything is homogeneous with a heavy federal govt, there's fewer and fewer places to go... --96.46.xxx.xx
New Tax Laws? (by RathdrumGal [ID]) Posted on: Dec 19, 2017 9:59 PM
The property tax deduction cap will only apply to your residence(s). Taxes on commercial property will continue to be a deduction from gross income, just as always. --98.146.xxx.xx
New Tax Laws? (by Smokowna [MD]) Posted on: Dec 20, 2017 3:14 AM
I'm a landlord. So I would simply use the bottom line numbers in 2017 tax software and compare the result to 2018 software.
Now I do know business turns on tax decisions so laws passed today will definitely effect tomorrow. That is a tougher one to measure.
New Tax Laws? (by myob [GA]) Posted on: Dec 20, 2017 4:40 AM
my state doesn't allow that tax deduction -- therefore I feel as if I am subsidisings those states that do.
Because 2 or 3 states have higher (hugh) taxes it's reasoned they should be allowed to deduct those. NO NADA NOT. They those few states need to curb their give away programs and over spending. They are in reality asking all of the other state to pay for THEIR generosity to their Residents. --99.103.xxx.xxx
New Tax Laws? (by nhsailmaker [NH]) Posted on: Dec 20, 2017 4:42 AM
Based on the fact that Journalism is indeed DEAD - I will not believe any of the crap I read or hear from the media until I actually get the final script . I pay my accountant to do that. Not a single brain cell is being expended to worry about what coulda shoulda woulda happen. There are a few legal and business analysts that I respect and do listen to them when they appear on TV or print. It is pure insanity to accept the word on anything from a journalist as their training has zero rigorous endeavor in the fields of economics or the legal industry. --24.34.xx.xxx
New Tax Laws? (by John... [MI]) Posted on: Dec 20, 2017 5:28 AM
Deanna: The current/past standard deduction was $6,350. That is "doubling" to $12,000. However, the $4,050 personal exemption is going away. So, it isn't really doubling like some people want to pretend. I grabbed this quick explanation:
"Here's how that math works. Let's say you are single with no dependents, and you have a moderate income. Currently, you get to take the standard deduction ($6,350) and one personal exemption ($4,050). If you are 65 or older, you also get to take an additional standard deduction ($1,250). That adds up to $10,400, or $11,650 if you're over 65.
The Republican plan would replace all these provisions with a single deduction of $12,000 ($24,000 for married couples.) That's a 15% increase — except for seniors, who get a 3% increase."
So, there is a lot of talk about "doubling" the standard deduction -- but it doesn't really do that once you do the math. :)
New Tax Laws? (by AllyM [NJ]) Posted on: Dec 20, 2017 5:40 AM
I hope the ten K limit is just on prop tax for personal homes because I pay 8 K for the big duplex now and around 4 k for the other two. Then 4 K on my home. I don't quite get where this deduction limit comes from or what the hope is that it does. Maybe it goes like this, if you are rich enough to own a home that has prop taxes over 10 K then you don't need the help from uncle sam to pay them. Trouble is in NJ here it doesn't take much to get it up to 10 K. Some really big but run down homes in bad neighborhoods near Trenton are up around 10K.
I think as this whole bill shakes out there may be some executive orders. --73.33.xxx.xxx
New Tax Laws? (by Beth [WI]) Posted on: Dec 20, 2017 5:49 AM
Landlords that aren’t too highly leveraged AND have a W2 job will get to deduct 20% of their profits. So, quite a nice benefit for folks like Sid. --24.177.xxx.xx
New Tax Laws? (by Beth [WI]) Posted on: Dec 20, 2017 5:54 AM
I have to say... no social security tax, depreciation, and now the 20% tax on profit (I think to be deducted against W2 income) makes for quite low taxes for some folks with rental income. Some of us are doing far better on this new tax bill than others.
Then again not so much of a surprise. Trump has rental property as do many politicians. --24.177.xxx.xx
New Tax Laws? (by myob [GA]) Posted on: Dec 20, 2017 6:13 AM
Beth WI-- 20% tax on "profit" we're LL's we have no profit? Didn't you go to that seminar? --99.103.xxx.xxx
New Tax Laws? (by LindaJ [NY]) Posted on: Dec 20, 2017 6:33 AM
Until the bills are available and actually interpreted, I don't believe all the sound bites that the news reports. It was hard trying to find the three things that violated senate rules, the news was not reporting what they were.
The tax deductions were only useful if you itemized on your personal return anyway. I suspect that taxes on rental property is a cost of doing business and will still be deductible. Just as the mortgage interest was.
Even living in a high tax state, listening to our big mouth governor, I am fine with losing it on my personal home. Without a mortgage we haven't itemized in years. I suspect only the richer are using it anyway. Maybe it is time for the high tax states to look at those taxes and lower them. We give away so much in this state as incentive to business to come because our taxes are too high. Just lower them. Now we are giving a bunch of stuff to Puerto rico. Nice to help them, but not with our tax money.
I am all for a simple lower tax. Too much time, effort and money is lost in doing taxes. Too much is subsidized forever, too much is a favorite deductions pushed by the group that uses it. I think a whole lot more has to be done to make taxes simpler. --96.236.xx.xx
New Tax Laws? (by Deanna [TX]) Posted on: Dec 20, 2017 6:34 AM
Thanks, John (MI)! --96.46.xxx.xx
New Tax Laws? (by RB [MI]) Posted on: Dec 20, 2017 7:14 AM
I know that's right ! --71.13.xx.xxx
New Tax Laws? (by RentsDue [MA]) Posted on: Dec 20, 2017 7:15 AM
I'm not too worried about it. The guy at the top who wrote the new tax code made his fortune in real estate. --66.189.xx.xxx
New Tax Laws? (by Pmh [TX]) Posted on: Dec 20, 2017 8:19 AM
I think he made his $ by licensing his name as a brand. not from his numerous re bankruptcies & stiffing vendors and employees.. --166.137.xxx.xx
New Tax Laws? (by LindaJ [NY]) Posted on: Dec 20, 2017 8:44 AM
online calculator --- taxplancalculator.com
New Tax Laws? (by Emily [TX]) Posted on: Dec 20, 2017 1:19 PM
This law will have a huge effect on me because my day job involves tax depreciation and like-kind exchange. Section 1031 is being amended to apply only to real property, as most of you know, but my clients are all companies with personal property (cars, equipment, etc).
I have read a lot of the bill, or the version from last Friday's conference agreement anyway.
Unfortunately I don't feel that the current bill has made taxes simpler; it has introduced a whole new set of complexities, and that's not even considering state implications. Plenty of states don't follow federal law in many areas of tax and this is only going to get worse.
Then again, it means job security for me, so I can't complain. On a personal level we will only be affected by loss of the personal exemption. We have always itemized so the larger standard deduction is meaningless to us. --155.201.xx.xx
New Tax Laws? (by Dan [NY]) Posted on: Dec 20, 2017 6:22 PM
Being someone from a higher taxed state I must chime in on this. Also, being someone who is a CPA who doesn't practice and has a good understanding of the tax law. Many folks in NY do pay higher taxes. However, we are a state with many people and require more services compared to states with fewer folks. We are also a state that generally has a higher cost of living along with higher salaries. The folks who retire from NY can move to any section of the country and sustain a comfortable living or retirement, the reverse isn't always true (no insults intended). People complain about higher taxes, but we all know an economy is interdependent on local factors. Those areas with low taxes don't usually support higher incomes. It should also be noted the net dollars given to the Feds from NY exceed the funds returned. In fact, NY helps those state who have a higher rate of return on every dollar sent to the FEDS. For example, look at South Carolina who receives about $3.oo for every $1.00 spent to the Feds. Again, most incomes don't compare to NY salaries. As such, many higher taxed states are subsidizing lower income states. It just so happens NY and California are blue state and SC is a red state. Is the tax plan politically motivated by Trump? Will the tax law harm the economy of NY and California. If so, will the deficit grown larger since the higher tax state do subsidize those lower earning states? The increase in the standard deduction will not compare to the lose in state income tax deduction or limit on personal property taxes deduction of $10,000 (SALT). In fact, most folks who itemize currently will not be able to itemize their deductions going forward. An individual who owns a home compared to someone who doesn't in most cases will get the same tax benefit. Will the lack of incentive of buying a home cause a reduction in home values across NY, including the suburbs of NY City? The lose of the dependent exemptions and personal exemptions will also add up quickly. This may amount to a lose of $20,000 for a family of five. The flow through entitles will see a saving, but again who gains the most? The small landlord or the top 1% with the real dollars including our elected officials like Trump. We have no guarantee the redistribution of wealth (a common practice of democrats) will force companies to hire more folks and increase salaries, but most likely will go to a select few. Maybe we should focus on everyone paying their fair share. Always remember, a good economy relies on spending and ultimately helps the quality of life for everyone. Money sitting in vaults or pockets of the top 1% will not help most folks, including most landlords. A tax law encouraging investment in equipment, research and education would have a more positive impact on the economy for everyone. I wouldn't be surprised if the current plan brings income down for the common folks and further increase wealth gaps in our country. --68.192.xxx.xx
New Tax Laws? (by GKARL [PA]) Posted on: Dec 20, 2017 7:42 PM
Limiting 1031 to real estate is a underhanded tax increase. There are many folks who section 179 personal assets like business vehicles and trade them in who will now pay taxes on the gains. In Northern NJ, property taxes routinely exceed $ 10000 and here in PA, state and local combined can also top $ 10,000. Miscellaneous itemized deductions are gone, so no deduction for employee business expenses. All of these are tax increases targeted mainly on the middle class taxpayer. The middle class is the only demographic who has money to take and that's what they did. The poor will be hit with the entitlement cuts. There is some benefit for r/e passthroughs but depending on your situation, that could either be a wash or a net benefit. Corporate tax rate cuts will drive stock prices up, but that doesn't benefit the broad swath of the public. Gallup polls show about half of the public don't support. --207.172.xx.xxx
New Tax Laws? (by Dan [NY]) Posted on: Dec 20, 2017 7:56 PM
Gkarl I would agree with your take. Not good for the middle class. “Entitlements” will be next. Social security is also an entitlement regardless of popular belief. The wealthy don’t understand the importance of programs for many people. I don’t think this plan is good for the market as a whole. --68.192.xxx.xx
New Tax Laws? (by Kyle [IN]) Posted on: Dec 20, 2017 8:41 PM
The SALT limit won't hurt landlords, property taxes on rentals are deducted on Schedule E.
The standard deduction change will cause less people to itemize. Only about 30% do now and that will decrease.
The standard deduction increase is mostly offset by the personal exemption elimination.
Less itemizing is the only "simplification" I see in the bill. There are still just as many tax brackets and an AMT. Also, a new pass thorough deduction tax calculation to complicate things.
And, there is some last minute real estate pass through deduction. That may be a boost for landlords, but I haven't seen the details of that calculation yet.
New Tax Laws? (by GKARL [PA]) Posted on: Dec 21, 2017 1:37 AM
Dan, I see this tax plan as fiscal stimulus for the securities markets coming on the heels of the Fed's ZIRP policy which is producing diminishing returns. A small group of entities received extraordinary support from the central bank which now is being followed up with fiscal stimulus. The only place the corporate tax cuts can go is to shareholders.
There's no question that the middle class are the bag holders here. Yes, entitlements are next. The elephant in the room is defense spending which has been increased and is considered sacrosanct. --207.172.xx.xxx
New Tax Laws? (by GKARL [PA]) Posted on: Dec 21, 2017 1:54 AM
The SALT limit will hurt many people including LL. I looked at my return today and the SALT deduction is over $ 10,000. I'm also going to get impacted by the loss of the personal exemptions. The increase in the standard deduction, means I won't itemize any longer, but the net of it means less deductions while remaining in the same marginal tax bracket. Some of this may very well be offset by the deduction on pass throughs, but there are landmines there as one's AGI can suspend those deductions as well. Who benefits and who pays is really a case by case situation. --207.172.xx.xxx
New Tax Laws? (by NE [PA]) Posted on: Dec 21, 2017 5:09 AM
I love my accountant. --50.32.xxx.xx
New Tax Laws? (by John... [MI]) Posted on: Dec 21, 2017 6:37 AM
GKARL: Your PERSONAL RESIDENCE SALT is over $10,000? Wow. That's high taxes (or a very expensive home).
I'm with Kyle. Most of this doesn't change much. SALT is not affected on rental properties as they still go on Schedule E.
For most people, the increased standard deduction offsets the loss of the personal exemption (or, actually, they tend to do a little better). For a while, this was NOT the case for a family of 4 with two kids -- but they increased the child credit so even they are about the same now.
New Tax Laws? (by John... [MI]) Posted on: Dec 21, 2017 6:38 AM
In my opinion, the change to 1031 to be real property only was actually aimed at cryptocurrency traders. Right now, people doing Bitcoin and other such cryptos were delaying any capital gains by doing "like kind" exchanges among different currencies. Now that can no longer be done.
New Tax Laws? (by Emily [TX]) Posted on: Dec 21, 2017 7:35 AM
In my purely personal opinion and speculation, the change to section 1031 was to close a perceived "loophole" in that when section 1031 was enacted, it likely was intended to apply to real property; then some smart accountants figured out that it could be utilized on a scale of smaller and more numerous assets (auto fleets, etc) as well.
The corporate AMT is being repealed so that is a simplification from that standpoint, but I really would have liked to see them repeal the individual AMT as well.
Also notable: change of luxury auto limits, for those to which that applies. --155.201.xx.xx
New Tax Laws? (by GKARL [PA]) Posted on: Dec 21, 2017 2:51 PM
John: I don't have a particularly expensive home, however, keep in mind that the SALT deduction includes both real estate taxes and state/local income taxes. Between the both, many folks will blow past the $ 10,000 threshold. --64.121.xxx.xxx
New Tax Laws? (by GKARL [PA]) Posted on: Dec 21, 2017 3:04 PM
The idea behind tax free exchanges was that one's position hadn't materially changed by exchanging one asset for another. The gain was deferred rather than exempted altogether as the basis of the new asset is essentially the basis of the old plus any "unlike asset" (i.e. cash) that was a part of the exchange. As I mentioned, many people trade in business vehicles with a basis of zero due to taking the section 179 election. Those people will now be paying taxes on the trade in allowance. If crypto currencies were an issue,they could have just dealt with them directly.
I can't imagine the surprise folks are going to have when I tell them they have to pay taxes on their trade-in. But again, the passthrough deduction may offset. --64.121.xxx.xxx
New Tax Laws? (by nhsailmaker [NH]) Posted on: Dec 21, 2017 3:23 PM
Here in NH we have no income or sale taxes to deduct. Nor do we have helmet laws, Seatbelt laws, concealed carry laws, etc etc etc.. I could go on and on. We have one of the highest income states. We have a 400 member citizen legislature that only get paid $100 a year for meeting just a few weeks on our 2 year budget. It is not rocket science. as our former governor said low taxes are a direct result of low spending ( a lightbulb moment for democrats). I use to work in NYC, SF and Boston to name some of the most expensive places to live in the USA - I hope every resident that gets hit by these new taxes finally realize they get nothing in return for their taxes except failed socialism. --24.34.xx.xxx
New Tax Laws? (by razorback_tim [AR]) Posted on: Dec 21, 2017 3:38 PM
Has anyone seen if there is any deductions for disregarded entities or properties that are directly on your schedule E similar to the deduction for pass-through entities? --70.178.x.xx
New Tax Laws? (by LisaFL [FL]) Posted on: Dec 21, 2017 4:05 PM
Good question razorback. My accountant emailed me today saying there is still confusion over that but he's staying on top of it. It's nice that's he's a landlord too. --173.170.xxx.xxx
New Tax Laws? (by GKARL [PA]) Posted on: Dec 21, 2017 4:13 PM
As i understand it, disregarded entities and straight schedule c and e are considered pass throughs --172.58.xxx.xx
New Tax Laws? (by Jeff S [MI]) Posted on: Dec 25, 2017 6:39 AM
I guess I am in a similar boat as Dan NY status in the profession. However when this thread started it was before the final bill. A few changes along the way. John MI and others had good summaries. Myself going to be hit on personal side basically by losing exemption, already at the level they are bumping up to for standard deduction. Since this is all new, your accountants will need to get up to speed. My quick reading of a summary of the passed bill seems to note that depreciation deductions for quick write off still intact and from memory WILL allow the component depreciation type items to be included. Schedule E deductions should remain, but folks on Schedule A seems that that many will lose deductions. I still need to digest some language in the pass thru entities, personal AMT changes and 1031 categories allowed ... --68.43.xx.xxx
New Tax Laws? (by Chris [CT]) Posted on: Dec 25, 2017 7:37 AM
Most of the low tax states get subsidized by the high tax states.
Maybe its time that's changed a little bit.
I'm looking at you freeloading South Carolina... --24.45.xxx.xx
New Tax Laws? (by Dan [NY]) Posted on: Dec 25, 2017 9:45 AM
Details will follow. If I'm correct, AMT deductions will have little impact on the "normal" person since AMT impacts many deductions that the "normal folks" won't be taking, it may be a mute. The tax bill doesn't encourage home ownership so the markets in certain areas can see a change, like in NY and California on a personal level, new investors. --68.192.xxx.xx