Central Mississippi REALTORS
620 N. State Street Suite 100
Jackson, MS 39202
FOR IMMEDIATE RELEASE:
December 7, 2017
Congress is One-Step Away from Sending the Tax Reform Bill to the President
Did you know that as a homeowner, all home loan interest and property taxes that you pay each year are deductible from your taxable income? Other housing-related expenses that you may be eligible to deduct under the current tax law include mortgage insurance payments, mortgage loan points and moving expenses. In Mississippi alone, over 200,000 claims for real estate tax deductions were filed. The average deduction subtracted from taxable income was $2,050!
This homeownership benefit generally works when your itemized deductions exceed the standard deduction. This dollar amount varies based on your individual filing status and may reduce the amount of income on which you are taxed. New homeowners may benefit the most from these deductions as the first few years of mortgage payments are primarily going towards interest.
For homeowners looking to sell their homes, you have a tax benefit of excluding up to $250K of the profit you earn from taxable income, if you have lived in your home for at least two of the past five years. If you’re married, file a joint return and meet other requirements, you may be eligible to exclude up to $500K of your profit from capital gains taxes.
Proposed Tax Reform Changes to Your Housing-Related Deductions
The House and Senate’s original draft of H.R. 1 “Tax Cut & Jobs Act” outlined a tax reform plan that would damage incentives for homeownership. The proposed reform caps the mortgage interest deduction at $500K for new mortgages, nearly doubles the standard deduction and limits the exemption on Capital Gains Tax from the sale of a primary residence. Additionally, the bill would eliminate the deduction for state and local income or sales taxes, eliminate the mortgage interest deduction for second homes and new home equity loans, eliminate the deduction for moving expenses, student loans, medical expenses and personal casualty losses such as from hurricanes or wildfires.
Your voice is helping but additional improvements are needed!
Over the past 7 weeks, over 200,000 REALTORS® have taken action by contacting their Congressmen and Senators urging for more favorable legislation for homeowners and it has paid off! Both the House and Senate have already agreed to maintain deductibility of state and local property taxes up to $10,000. Both have also agreed to maintain Section 1031 tax-deferred exchanges in their present form for real estate investments.
REALTORS® need your support this week! Now that both the House and Senate have passed the “Tax Cut and Jobs Act,” a Conference Committee is addressing differences between the two bills. It’s not too late for you to ask Congress to continue making tax reform favorable for homeowners by maintaining the current law for the mortgage interest deduction (MID) and capital gains exclusions.
REALTORS® know that these provisions are needed to continue to strengthen the ability of qualified American families’ ability to purchase a home. To take action or learn more about why REALTORS® oppose the “Tax Cuts & Jobs Act” tax reform legislation, visit https://homeownershipmatters.realtor.