Source: National Association of Realtors
The Tax Cuts and Jobs Act was finalized on December 20, 2017 and went into effect after December 31, 2017. So what does this mean for you, as a current or potential homeowner? We give a breakdown on important numbers for current and potential homeowners here:
- $750k = limit on mortgage interest deduction (for mortgages issued after Dec. 15th, 2017)
- $10k = state and local deduction for income, sales, & property taxes
- $12k = standard deduction for single filers
- $24k = standard deduction for married filing jointly
- $0.00 = personal exemptions
- 2 out of 5 years = how long you have to live in a primary residence to qualify for capital gains exclusion
- 15% = max rate on capital gains (generally speaking)
Source: Samantha Sharf at Forbes
Trump’s Tax Cuts & Jobs Act was released at the beginning of November (follow the live coverage about it on The Wall Street Journal’s website). Three major components of this Reform that are relevant to buyers, sellers, and investors are:
- the mortgage interest deduction will go from $1million to $500k,
- a new cap on property taxes, and
- capital gains limitations.
These all become more concerning as the median home price is approaching $500k in Denver.