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Good thread and interesting points raised all around. Given the amount of federal tax dollars paid by high income states like CA, NY, NJ, etc., I don't buy the argument that those states are somehow "takers" and the rural and much poorer states in the south are subsidizing us. The amount of federal tax dollars paid by residents in NYC and its very wealthy suburbs alone is astounding, and I want my damn SALT deduction back.
The real unfairness with the tax change is that people purchased homes on the long-settled assumption that they would be able to deduct their real estate taxes from their federal tax bill. Unlike the change to the mortgage interest deduction, which only applies to future home sales, you now have lots of families like mine who bought our long-term home 4 years ago, and suddenly the large deduction we were counting on has been taken away. I would have much less of a problem if this was done prospectively, so that real estate buyers would know what they were getting into. My wife and I are extremely conservative with our budgeting and spending, and despite that we thought we were buying a home well within our means, we're now stuck with a $21,000 property tax bill that is entirely non-deductible for us. And that's really annoying.
Financial savvy does not mean you are an expert in Tax Code....
That is like saying if you know a bit of HTML you can make your own website.
If that was the case, squarespace and WIX would be bankrupt.
American DIY culture has gone too far. A lot of people are hurting themselves and it's literally costing them thousands of dollars...Somebody above just said that SALT is so bad it basically negates the value of ownership! And there are folks who don't think it's a big deal...
My mother always told me people are stubborn hard headed and always want to go the hard way...
Part of a CPAs duty is to help you weather future storms in policy changes. There hasn't been a drastic tax change like this in a long time... Did it not occur to any homeowners here to at least go to HR Block to ask the question? (They are like the Walmart of Accountants but at least can provide some kind of general guidance)
Would you go up against the DA who is trying to falsely convict you of attempted murder without proper representation?
Agreed and I’m sure there are many people who do their own taxes and are thrilled thinking they saved money and had the satisfaction of doing it themselves.
That being the case, they never know if they could have kept much more money had it been prepared by a professional who better understood the nuisances of the tax laws. One never knows!
Agreed and I’m sure there are many people who do their own taxes and are thrilled thinking they saved money and had the satisfaction of doing it themselves.
That being the case, they never know if they could have kept much more money had it been prepared by a professional who better understood the nuisances of the tax laws. One never knows!
I often wonder about this because I do my own taxes. I figure I don’t have a complicated tax story. Not yet at least. I did take my stuff over to H&R Block this year hoping I was doing something wrong. That tax preparer and I pretty much have the same numbers on the nose. Do you think it would be who’ve me to try to find a more sophisticated accountant?
Agreed and I’m sure there are many people who do their own taxes and are thrilled thinking they saved money and had the satisfaction of doing it themselves.
That being the case, they never know if they could have kept much more money had it been prepared by a professional who better understood the nuisances of the tax laws. One never knows!
It's pretty easy to find out. Go pay the expert one time, and see if they come up with something different than you did.
I often wonder about this because I do my own taxes. I figure I don’t have a complicated tax story. Not yet at least. I did take my stuff over to H&R Block this year hoping I was doing something wrong. That tax preparer and I pretty much have the same numbers on the nose. Do you think it would be who’ve me to try to find a more sophisticated accountant?
H&R block is really the equivalent of doing the taxes yourself on Turbotax, with the help of someone who is familiar with the software. H&R Block employees do not have a degree in accounting, or anything else for that matter.
H&R block is really the equivalent of doing the taxes yourself on Turbotax, with the help of someone who is familiar with the software. H&R Block employees do not have a degree in accounting, or anything else for that matter.
Good thread and interesting points raised all around. Given the amount of federal tax dollars paid by high income states like CA, NY, NJ, etc., I don't buy the argument that those states are somehow "takers" and the rural and much poorer states in the south are subsidizing us. The amount of federal tax dollars paid by residents in NYC and its very wealthy suburbs alone is astounding, and I want my damn SALT deduction back.
The real unfairness with the tax change is that people purchased homes on the long-settled assumption that they would be able to deduct their real estate taxes from their federal tax bill. Unlike the change to the mortgage interest deduction, which only applies to future home sales, you now have lots of families like mine who bought our long-term home 4 years ago, and suddenly the large deduction we were counting on has been taken away. I would have much less of a problem if this was done prospectively, so that real estate buyers would know what they were getting into. My wife and I are extremely conservative with our budgeting and spending, and despite that we thought we were buying a home well within our means, we're now stuck with a $21,000 property tax bill that is entirely non-deductible for us. And that's really annoying.
Just rest assure your 21000 a year property tax bill is providing a great service for your municipality. And that by foregoing your property bill deduction you are saving money for the state and federal government.
You don’t need a salt deductions. Just be happy with what you have.
Just rest assure your 21000 a year property tax bill is providing a great service for your municipality. And that by foregoing your property bill deduction you are saving money for the state and federal government.
You don’t need a salt deductions. Just be happy with what you have.
These SALT deductions only matter to a small percentage of people. They don't impact the wealthy and I don't really understand why state and property taxes cannot be used by the poor and working class. For the segment of middle-class who can really use those few thousand (as spending power) I don't see what the problem is. What's it about, really?
Well, I’m not in the same boat and I’m paying more. I don’t hit the SALT cap at all, I am at about $8k in state and property tax. I’m a single mom in Virginia (a purple state) and I am paying more on my total tax bill. I think something with head of household changed.
I too am facing college for my daughter soon and am not sure how we are going to pull it off. I’m one of those lucky people who earns too much to get financial aid, but not enough to afford today’s college tuitions. My AGI is $57k for 2018. Her PSAT scores are such that if she does the same in her junior year she might be able to get a Pell grant. I don’t think her dad is going to help her. He has a Post 9/11 GI bill he can use for her from the military, but he will only use it if I pay him about $20k a year to do so. I don’t have that kind of money and it seems unethical or illegal. Is it legal to pay someone for their free government benefit? My spidy senses just tell me it’s wrong.
I have a 529 for her and I’ll probably just stop saving for retirement when she goes to college. I’m thinking about a HELOC too To be used as a last resort. We are also looking at a local university where she could live with me and not pay room and board. Luckily she wants to major in accounting, finance, or business (something with math, but not engineering) and that gives us flexibility when choosing a school.
My point is, I’m pretty apolitical but as someone who pinches every penny, this tax change rubs me the wrong way. I’d vote for someone who could give me more of my money back.
VA has great public universities and CC's that aren't expensive, you need to go that route. Pell grant is not based on test scores, just solely on need. The GI bill transfer should be used, if he was an adequate parent, unless he's expecting to go back to school.
Do not jeopardize your retirement for this. I went to school with pell grants, subsidized stafford loans, and part time jobs (easy on-campus jobs after classes/weekends). It's when we hand out everything to our kids that it becomes an expectation when they are adults.
Well, I’m not in the same boat and I’m paying more. I don’t hit the SALT cap at all, I am at about $8k in state and property tax. I’m a single mom in Virginia (a purple state) and I am paying more on my total tax bill. I think something with head of household changed.
I too am facing college for my daughter soon and am not sure how we are going to pull it off. I’m one of those lucky people who earns too much to get financial aid, but not enough to afford today’s college tuitions. My AGI is $57k for 2018. Her PSAT scores are such that if she does the same in her junior year she might be able to get a Pell grant. I don’t think her dad is going to help her. He has a Post 9/11 GI bill he can use for her from the military, but he will only use it if I pay him about $20k a year to do so. I don’t have that kind of money and it seems unethical or illegal. Is it legal to pay someone for their free government benefit? My spidy senses just tell me it’s wrong.
I have a 529 for her and I’ll probably just stop saving for retirement when she goes to college. I’m thinking about a HELOC too To be used as a last resort. We are also looking at a local university where she could live with me and not pay room and board. Luckily she wants to major in accounting, finance, or business (something with math, but not engineering) and that gives us flexibility when choosing a school.
My point is, I’m pretty apolitical but as someone who pinches every penny, this tax change rubs me the wrong way. I’d vote for someone who could give me more of my money back.
Wow. That is rough. I'm so sorry. I don't know how single parents do it. I heard last year they would be messing with head of household.
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