Let me start this article with a big fat disclaimer: I’m not a CPA, tax attorney, or any type of tax specialist.  Any information presented here is based on my personal best understanding and should not be used as specific tax advice.  

With that said, here’s a quick summary of what’s new:

1. SALT Tax Deduction: Your maximum write off is $10,000 of your state and local income tax (i.e. SALT), and your property taxes from your federal tax returns.  For example, if your married household income is $150,000 your state income tax is ~$7,900.  Add that to the property tax of ~$5,000 on your $650,000 home, your total state and property tax liability is $12,900.  Of this, only $10,000 could be written off your Federal Tax Returns. This tax is meant to impact higher earners and owners of higher value properties. 
2. Mortgage Interest Deduction:  If you bought a home before December 14, 2017, you can deduct the interest on up to $1,000,000 in debt and the interest on up to $100,000 in a  home equity debt. When you buy after December 14, 2017 up to 2026, your mortgage interest write-off is capped at $750,000. This is another rule that affects homeowners in San Diego a lot since we have a lot of homes over $750,000.  

Those are the two new tax rules affecting property and mortgage.   There are a lot of other rules including some very favorable rules about business vehicle use depreciation for business owners.  I do recommend talking to one or more tax experts before filing. I also recommend talking to them as you are planning out your year.  Being prepared and aware of all the rules, let’s you play the game by playing the rule book instead of doing the same thing you did in prior years.  That’s how the professionals do it!

Speaking of professional, check out a virtual reality tour of our latest investment property remodel at 5673 Marne Ave, 92120.  Professional grade rehab and sale means a very happy new family in the neighborhood and higher property values for everyone in the area!