Now that the House and Senate have passed their own versions of tax reform, homeowners are wondering what’s next? There’s no reason to panic just yet because we don’t know which version will be adopted. Furthermore, the majority of mortgage interest deductions won’t be affected anyway since the majority of mortgages are under $500,000. For the higher priced areas we certainly hope that the Senate version will prevail.
Here’s a breakdown on the legislation:
|Deductions||Senate Version||House Version|
|Capital Gains Exclusion||Owner must have lived in the property for 5 of the last 8 years||Same|
|Property Taxes||Deduction limited to $10,000||Same|
|Mortgage Interest||Deductions on loans up to $1-million||Deductions on loans up to $500,000|
|State & Local Taxes||Not deductible||Same|
|Second Home Mortgages||Not deductible||Same|
|Moving Expenses||Not deductible||Same|
|Home Equity Line of Credit||Not deductible||Same|
|Interest on Student Loans||Not deductible||Same|
The next step is for both sides to come to an agreement on a final bill. And then that bill needs to be voted on. It’s not too late to make your voice heard. Let your congress member know what you’re thinking! Click here for an easy way to contact them.