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Wait until the impact of the SALT deduction limit ripples through the housing market. When people figure out that the tax deductible incentives of home ownership have been effectively eliminated, residential real estate values are going to decrease dramatically. Tax incentives for buying a house have been a major factor for decades.
Maybe some areas but just like last time beach communities held strong. Vegas and Phoenix got crushed.
I admit that the new tax law did affect me badly in some ways, but nothing compared to the way that it did my friends in California. My best friend didn’t even want to talk about it when I asked him. He said that it was the FIRST time that he ever OWED $ back. It seems to me that it hit them like a sudden earthquake. Then, I recalled the way that Reagan instituted his Tax Reform back in 1986. I was only in my 20s then, but remember that the estate tax was raised GRADUALLY from $600,000 to higher amounts over time. The credit card debt went from a 100% deduction GRADUALLY to lower deductible percentages each year. Bottom line, it gave taxpayers some time to prepare! The way in which these tax increases were rolled out seems too sudden and like simple retribution. No matter what, we are all still Americans whether we live in a blue or red state. I think that Reagan understood that regardless of his other faults.
In addition, I understand that the $10000 SALT limit will NOT increase with inflation (home price appreciation and tax increases). That also puts an additional TAX INCREASE over time for those ppl.
It was purposely done to get more taxes from California, Illinois, NY, NJ, Conn, Mass....and it was designed to allow resident in the red states to pay less...masterful.
It was purposely done to get more taxes from California, Illinois, NY, NJ, Conn, Mass....and it was designed to allow resident in the red states to pay less...masterful.
I wouldn’t be celebrating too much-Lady Karma doesn’t like that.
How are the federal tax laws "cruel to blue staters"? The tax law is the same for all people (now), regardless of which state you live in-at least after you hit the SALT deduction limit. Previously two individuals that made the same amount of money paid a different amount of federal income tax, depending on the state tax they paid. How was it not cruel to "red staters" to have to subsidize the federal income tax of "blue staters"?
And even in blue states-it's only the rich with large amounts of mortgage interest and state taxes that are impacted, not the lower or low-median middle class taxpayer that is impacted. After all, the standard deduction for a married couple is $24,000. Now-don't we all think the rich should pay "their fair share"? Though, to be honest-even with the SALT deduction limit, they may still pay less, due to the tax rates being lower.
Wait until the impact of the SALT deduction limit ripples through the housing market. When people figure out that the tax deductible incentives of home ownership have been effectively eliminated, residential real estate values are going to decrease dramatically. Tax incentives for buying a house have been a major factor for decades.
Which will be a good thing. Income tax payers should not be subsidizing an artificial housing bubble. One that inflates home prices out of reach of many middle class taxpayers.
Cruel? Why? The high tax states were in essence stealing from the federal government by allowing the deduction... Personally, I would allow ZERO deductions from State taxes and property taxes... Why the heck should anyone get a deduction for that...
They want services and better education. Some people do not want to live like Mississippi, Alabama and the rest of the American Bangladesh.
And? They can continue to pay a ridiculous level of taxes on the local and state in order to get them. They just went be able to write them off at the federal level now. In other words, they're paying their fair share.
They want services and better education. Some people do not want to live like Mississippi, Alabama and the rest of the American Bangladesh.
Citizens in every state get education and services provided. Paying more in taxes does not guarantee better quality of either. I grew up in NYS, with a horribly high tax rate, both on income and property. Guess what? The roads and parks are not in any better shape than here in Idaho (which has about 1/3 the property tax rate). The schools are little different. The roads get plowed. After seeing the road conditions in CA, particularly the LA area-I can certainly say those taxpayers are not getting their money's worth.
Now-if the citizens of blue states do want better services-they should be willing to pay for them-not push their tax burden off to places like Mississippi, Alabama or the rest of the American Bangladesh.
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