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How Will Tax Reform Affect Your Home & Mortgage

Hi-lights of the largest tax reform in decades and the impact on one of your largest investmens - your home

Tax Reform has been a major topic in the real estate and mortgage industry. According to the National Association of Realtors, home price growth in 2018 is expected to range from 1—3%. While there was considerable change in the tax code, many coveted tax benefits to homeowners were retained. These include:

  • Capital Gains exclusion on sale of your primary residence was maintained. You're eligible for the exclusion if you have owned and used your home as your main home for a period aggregating at least two years out of the five years prior to its date of sale.

  • Mortgage Interest Is Still Deductible. But, reduces the limit on deductible mortgage debt to $750,000 for new loans taken out after 12/14/17

  • Home Equity Loan Interest. The final bill repeals the deduction for interest paid on home equity debt through 12/31/25. Interest is still deductible on home equity loans (or second mortgages) if the proceeds are used to substantially improve the residence.

  • Property Taxes. Allows an itemized deduction of up to $10,000 for the total of state and local property taxes and income or sales taxes. This $10,000 limit applies for both single and married filers and is not indexed for inflation.

The following websties provide more inclusive and more detailed information:

The information on this page is not intended to provide tax or accounting advice. Please verify with your CPA or tax professional.

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