SALT and mortgage deductions
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A few clarifications.
Mortgage deduction applies for debt up to $750k.
That's only going to be north of $20K if you have a 4%+ rate and/or are in the early part of your mortgage cycle (with more going to interest).
The SALT deduction is capped at 10K. That includes property, state income tax and even sales tax (rules are a bit wonky).
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@lufins-dad said in SALT and mortgage deductions:
The Mortgage Interest Deduction is still there,
It’s sorta there. They cap it at 10k. My property taxes are almost 35k. I have no mortgage, so unless my charitable giving is north of 14k I don’t itemize.
Someone in my neighborhood with a big mortgage would have gotten hit even harder. (They capped that too).
@jon-nyc said in SALT and mortgage deductions:
My property taxes are almost 35k.
Seriously?
I can't imagine residential property taxes in that order of magnitude.
I thought mine were high at just over $5K. They are not deductable from income tax either.
Elbows up!
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@jon-nyc said in SALT and mortgage deductions:
My property taxes are almost 35k.
Seriously?
I can't imagine residential property taxes in that order of magnitude.
I thought mine were high at just over $5K. They are not deductable from income tax either.
Yep. Its a relatively modest house too. 2400 sq ft on 1/3 acre lot.
It seems outrageous (and it is), but most people moving here from the city are giving up city income tax and private school tuition in exchange, so its a deal. (property taxes in the city are quite low)
If I lived over the border in CT it would be half for the same house. But the commute to the city would be longer.
Only non-witches get due process.
- Cotton Mather, Salem Massachusetts, 1692
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@jon-nyc said in SALT and mortgage deductions:
My property taxes are almost 35k.
Seriously?
I can't imagine residential property taxes in that order of magnitude.
I thought mine were high at just over $5K. They are not deductable from income tax either.
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I would say it's atypical.
NJ as a state has the highest property taxes in the nation, but at county level it's Westchester, NY.
@jon-nyc said in SALT and mortgage deductions:
I would say it's atypical.
NJ as a state has the highest property taxes in the nation, but at county level it's Westchester, NY.
The unsaid part is that I'm assuming you have a nice house, Jon
So not atypical from that aspect. But yeah, I get what you're saying. The tax rate is particularly high where you are.
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Yep. Its a relatively modest house too. 2400 sq ft on 1/3 acre lot.
It seems outrageous (and it is), but most people moving here from the city are giving up city income tax and private school tuition in exchange, so its a deal. (property taxes in the city are quite low)
If I lived over the border in CT it would be half for the same house. But the commute to the city would be longer.
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@jon-nyc said in SALT and mortgage deductions:
I would say it's atypical.
NJ as a state has the highest property taxes in the nation, but at county level it's Westchester, NY.
The unsaid part is that I'm assuming you have a nice house, Jon
So not atypical from that aspect. But yeah, I get what you're saying. The tax rate is particularly high where you are.
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A few clarifications.
Mortgage deduction applies for debt up to $750k.
That's only going to be north of $20K if you have a 4%+ rate and/or are in the early part of your mortgage cycle (with more going to interest).
The SALT deduction is capped at 10K. That includes property, state income tax and even sales tax (rules are a bit wonky).
@xenon said in SALT and mortgage deductions:
Mortgage deduction applies for debt up to $750k.
I am quite OK with capping mortgage interest deduction at certain level. I can understand allowing mortgage interest deduction to promote home ownership, but I see no point in subsidizing MacMansions.
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Yep. Its a relatively modest house too. 2400 sq ft on 1/3 acre lot.
It seems outrageous (and it is), but most people moving here from the city are giving up city income tax and private school tuition in exchange, so its a deal. (property taxes in the city are quite low)
If I lived over the border in CT it would be half for the same house. But the commute to the city would be longer.
@jon-nyc said in SALT and mortgage deductions:
Yep. Its a relatively modest house too. 2400 sq ft on 1/3 acre lot.
About the same as our house; a 2700 sq ft two storey with developed basement and double detached garage on a 150 x 60 ft lot. Mature neighborhood.
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@jon-nyc said in SALT and mortgage deductions:
The mortgage interest deduction should be full on eliminated.
Canada has never had such a deduction on residential properties. We also manage just fine to buy houses and pay out mortgages without too much undue stress in its absence. I wouldn't want such a deduction introduced either.
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It’s really a bank subsidy.
The older folks here will remember when all interest was deductible here, even credit card and auto. It was a big banking subsidy.
It’s not even a subsidy for homeownership, it’s a subsidy for “home borrowership”.
Only non-witches get due process.
- Cotton Mather, Salem Massachusetts, 1692
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It’s really a bank subsidy.
The older folks here will remember when all interest was deductible here, even credit card and auto. It was a big banking subsidy.
It’s not even a subsidy for homeownership, it’s a subsidy for “home borrowership”.
@jon-nyc said in SALT and mortgage deductions:
The older folks here will remember when all interest was deductible here,
All interest?
I remember when all taxes were deductible. I used to keep track of taxes on my utility bills (phone, heat, etc) and claim that deduction.
"Now look here, you Baltic gas passer... " - Mik, 6/14/08
The saying, "Lite is just one damn thing after another," is a gross understatement. The damn things overlap.
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@lufins-dad said in SALT and mortgage deductions:
The Mortgage Interest Deduction is still there,
It’s sorta there. They cap it at 10k. My property taxes are almost 35k. I have no mortgage, so unless my charitable giving is north of 14k I don’t itemize.
Someone in my neighborhood with a big mortgage would have gotten hit even harder. (They capped that too).
@jon-nyc said in SALT and mortgage deductions:
@lufins-dad said in SALT and mortgage deductions:
The Mortgage Interest Deduction is still there,
It’s sorta there. They cap it at 10k. My property taxes are almost 35k. I have no mortgage, so unless my charitable giving is north of 14k I don’t itemize.
Someone in my neighborhood with a big mortgage would have gotten hit even harder. (They capped that too).
Move to Florida.
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@jon-nyc said in SALT and mortgage deductions:
@lufins-dad said in SALT and mortgage deductions:
The Mortgage Interest Deduction is still there,
It’s sorta there. They cap it at 10k. My property taxes are almost 35k. I have no mortgage, so unless my charitable giving is north of 14k I don’t itemize.
Someone in my neighborhood with a big mortgage would have gotten hit even harder. (They capped that too).
Move to Florida.
@jolly said in SALT and mortgage deductions:
@jon-nyc said in SALT and mortgage deductions:
@lufins-dad said in SALT and mortgage deductions:
The Mortgage Interest Deduction is still there,
It’s sorta there. They cap it at 10k. My property taxes are almost 35k. I have no mortgage, so unless my charitable giving is north of 14k I don’t itemize.
Someone in my neighborhood with a big mortgage would have gotten hit even harder. (They capped that too).
Move to Florida.
Or Louisiana.
Nice cottage, close to LSU, and your property taxes would be considerably less....
https://www.zillow.com/homedetails/498-S-Lakeshore-Dr-Baton-Rouge-LA-70808/66265727_zpid/
“Cry havoc and let slip the DOGE of war!”
Those who cheered as J-6 American prisoners were locked in solitary for 18 months without trial, now suddenly fight tooth and nail for foreign terrorists’ "due process". — Buck Sexton
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@jolly said in SALT and mortgage deductions:
@jon-nyc said in SALT and mortgage deductions:
@lufins-dad said in SALT and mortgage deductions:
The Mortgage Interest Deduction is still there,
It’s sorta there. They cap it at 10k. My property taxes are almost 35k. I have no mortgage, so unless my charitable giving is north of 14k I don’t itemize.
Someone in my neighborhood with a big mortgage would have gotten hit even harder. (They capped that too).
Move to Florida.
Or Louisiana.
Nice cottage, close to LSU, and your property taxes would be considerably less....
https://www.zillow.com/homedetails/498-S-Lakeshore-Dr-Baton-Rouge-LA-70808/66265727_zpid/
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@jon-nyc said in SALT and mortgage deductions:
The older folks here will remember when all interest was deductible here,
All interest?
I remember when all taxes were deductible. I used to keep track of taxes on my utility bills (phone, heat, etc) and claim that deduction.
@george-k said in SALT and mortgage deductions:
@jon-nyc said in SALT and mortgage deductions:
The older folks here will remember when all interest was deductible here,
All interest?
I remember when all taxes were deductible. I used to keep track of taxes on my utility bills (phone, heat, etc) and claim that deduction.
86 tax bill removed deductibility of 'personal interest'
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From a WaPo piece after the 1986 tax bill. The same law removed local sales taxes also removed personal interest deduction (ex-mortgages).
State and local sales taxes will not be deductible. Income, real-estate and property taxes will be deductible.
Those who take the standard deduction cannot deduct charitable contributions, but itemizers can.
Deductions for interest on non-mortgage loans, such as credit-card debt or auto loans, will be phased out. Sixty-five percent can be deducted in 1987, 40 percent in 1988, 20 percent in 1989, 10 percent in 1990 and none thereafter.
