The Tax Reform bill has passed the House by 224 to 201 margin and is awaiting the President’s signature. NAR has produced a comprehensive document that summarizes the changes affecting real estate. This document will be available on www.NAR.realtor/taxreform
All-Member Email Later Today
Members will receive an email from NAR President Elizabeth Mendenhall that includes last-minute changes to the bill:
- Capital gains exclusion. In a huge win for current and prospective homeowners, current law is left in place on the capital gains exclusion of $250,000 for an individual and $500,000 for married couples on the sale of a home. Both the House and the Senate had sought to make it much harder to qualify for the exclusion.
- Mortgage interest deduction. The maximum mortgage amount for households deducting their mortgage interest has been decreased to $750,000 from the current $1 million limit. The House bill sought a reduction to $500,000.
- State and local tax deductions. Both property taxes and state and local income taxes remain deductible, although with a combined limit of $10,000. Both the House and Senate bills sought to eliminate the state and local income tax deduction altogether.
- Pass-through entities. The bill significantly reduces the effective rate of tax on business income earned by independent contractors and income received from pass-through entities. This change will lower the taxes of many real estate professionals.
Use this link for direct access to the tax reform summary document:
If you have any questions please contact John DiBiase 202-383-1037 or email@example.com