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New Tax Laws Impact On Real Estate

On December 20, 2017, Congress passed a tax reform act (a/k/a as the Tax Cuts and Jobs Act or the "Act"). The Act includes several major changes to the Internal Revenue Code (IRS) impacting taxpayers who own real estate. Most of the changes became effective on January 1st. The Act caps the deduction for state and local property (and income and sales) taxes to $10,000 per year. The bill also limits the deduction for interest incurred on debt used to acquire, construct or improve a principal residence to interest on up to $750,000 of debt (down from $1,000,000) and eliminates the deduction for interest on home equity debt. These caps are due to expire after 2025 under the Act, unless renewed before then. Please see the table below that reflects "prior tax laws" versus "new" laws.

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If you, or someone you know is looking to sell, buy, or invest into real estate in the near future, please contact us at Hearon Realty Group. We appreciate the opportunity to assist you with all your real estate needs!

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