As you may know, last month President Trump signed the “Tax Cuts and Jobs Act”, which makes changes to the tax code and will affect the real estate industry and individual taxpayers. Despite this act being signed in to law, the REALTOR® association, through participation of members nationwide, made great strides to get several items and provisions removed from the bill as we fought to protect the rights for homeowners. Many of the changes reflected in the final bill were the result of the engagement of NAR and its members. The final bill includes some big successes as NAR’s efforts helped save the exclusion for capital gains on the sale of a home and preserved the like-kind exchange for real property. Many agents and brokers who earn income as independent contractors or from pass-through businesses will see a significant deduction on that business income as well. Additionally, through the efforts of REALTORS®, the mortgage interest deduction (MID) was preserved at $750,000 for new mortgages originated after December 15, 2017, instead of the proposed $500,000 MID in the House bill, and remains available for second homes despite earlier attempts to limit it ti primary residences.
NAR has issued a news brief
about the Tax Cuts and Jobs Act which, among other information, highlights major provisions of the act that affect current and prospective homeowners, commercial real estate and real estate professionals. They also released this video
, featuring Evan Liddiard of NAR Government Affairs and Peter Baker, a CPA with Business Planning Group, who walk through the provisions in the tax bill passed by Congress that affect you as a real estate practitioner.
For more information about this topic, be sure to visit NAR’s Tax Reform homepage