From Forbes:
What The Republican Tax Bill Means For The Value Of Your Home
House Republicans released their long awaited tax bill Thursday. The proposal is a long way from becoming the law of the land, but the draft contains some red flags for the people who build, sell and own homes—as well as for people who want to buy them.
Three changes are particularly relevant: a reduction in the amount of mortgage interest that can be deducted, a new cap on property tax deductions and limits to the capital gains exemption used by homeowners when they sell.
Real estate professionals have been quick to cry foul, arguing the proposals would eliminate the tax incentive to buy, turning America into a nation of renters and putting pressure on home values. Already the homeownership rate is near an all-time low at 63.7%, they point out. William Brown, president of the National Association of Realtors, calls the bill “nowhere near as good a deal as the one middle-class homeowners get under current law.” Some outside the industry, however, contend that in the long run the only real loser will be the industry itself.
…
While the median price of a house sold today is $245,000, in some expensive markets a $500,000 loan does not come close to paying for most homes. Some fear the lower cap would be particularly detrimental to first time buyers in such markets. Moreover, creating a distinction between current and future homeownership could create a disincentive to move, intensifying an already severe inventory shortage at the entry level. Increases in home values over the long term will also eat away at the value of the deduction if a plan to raise the cap over time is not put in place.At the same time as the plan cuts back on deductions for individual homeowners, it exempts real estate investors from a new 30% limit on interest deductibility for businesses. “This tax plan would turn America from a nation of property owners into a nation of tenants renting from private equity-backed landlords,” argues Vishal Garg, CEO of Better Mortgage, an online mortgage lender focused on Millennials. “Why should corporate landlords get the deduction if your consumer homebuyer can’t?”
Another change is to the provision that allows homeowners to exclude from their taxable income up to $250,000 in capital gains ($500,000 for married taxpayers) from a sale of their primary residence. Under the plan, to qualify for this break, homeowners must have owned and lived in the home for at least five of the last eight years. Currently the rule is two of the last five. Taxpayer use of the exclusion would also be limited to one sale every five years, rather than one every two. In addition, under the house bill, you begin to lose the gains exemption if adjusted gross income (in a look-back period) exceeded $500,000 if married or $250,000 if single.
Expensive markets would also be hit by the proposal to cap the deduction for property on a home at $10,000. Currently all state and local taxes are deductible in the ordinary tax (although not in the alternative minimum tax, which would be eliminated by the house bill). In the lead up to the bill’s release, local tax treatment was one of the most contentious issues. Originally on the chopping block, property taxes were spared after a revolt from Republican lawmakers from high-tax states like New York, where the effective property tax rate is 1.38% of a property’s value, and New Jersey, where the effective rate is 2.13%.
The compromise, however, did little to quell real estate industry anger or investor jitters. (It is also unclear how many House Republicans from high tax states will continue to oppose the bill because of the $10,000 cap and because state and local income taxes wouldn’t be deductible at all.)
The bold paragraph, very important. Creates a perverse disincentive/incentive that will absolutely benefit the very wealthy. I’ve been screaming about this for the past month. It would be relatively straightforward for a landlord to restructure the ownership of their rental units in such a way that provides them a significantly lower overhead.
Also, keep reading to the paragraph after – cap gains exclusions.
Many are in for a RUDE awakening.
From yesterday, on photos:
Abeiz, thanks. Question, your comfort level on Google generally with data. Love the features like search with no tag. But they must be taking a deep dive into recognition and such on your photos just to do that, let alone presumably merging your photo data across their other platforms. I tag a photo with my son’s name, they can derive everything he does from the photos – camping, other interests, where he vacations, who his friends are, school activities, athletic interests, etc. I’m not part of the tin hat, no EZPass crowd, but wondering if I want to give one of two greatest data sponges on Earth all that info on friends and family lifestyle. I may continue to search for a photo app that isn’t part of Google, Facebook, etc. Anyone use a good hard disk program and just backup to the cloud?
Stu, I have good, high quality prints. I also have the negatives to many. They can date back to early 90s to current. From what I see online the negatives can be much better in terms of clarity and color when going to digital. I’m guessing I have a few hundred pics/negatives to run through. I see to expect a huge time PITA to get this done. Picture quality is more important to me than time. Presume there is an upper limit as to what one can do with a print, ie. at some point additional dpi becomes irrelevant because of original print limitations. Know that limit?
What I’m looking to do is have the flexibilty to run prints or negatives, I don’t need a constant feed as I’m willing (begrudgingly) to make the time commitment, and I likely need some decent software associated with unit so on an as scanned basis (especially for negatives) I can delete any photos I don’t want or tag them. If I need to upload everything and then go in and tag and delete with a separate software program so be it. Anything that directly interfaces with the photo app I’m looking at is a benefit. Recommendation on photo app therefore appreciated as well.
Online browsing seems to point to something like a high end Epson (Perfection V something IIRC) but they seem to run $600 or so. Not necessarily thrilled dropping that coin on a one time use…
Thanks!
So this is a good thing right ….making housing affordable again by bringing down prices while putting pressure on politicians to lower property taxes ….it’s a win win ….
It seems some will get but others the younger generations could benefit lower prices lower property taxes. Or keep the current format and screw the younger generations while trying to convince them it’s a good thing.
No, it’s not a good thing. You are missing the point. The price will come down because the incentive to purchase will be taken away. The only class of buyers left will be investors. They are the only class of buyers with the incentives still in place to own. So you will have a corporate class of owners feeding off the passive income of renters. Glad, you think the decline in home ownership is a good thing.
dentss dunnigan says:
November 4, 2017 at 9:52 am
So this is a good thing right ….making housing affordable again by bringing down prices while putting pressure on politicians to lower property taxes ….it’s a win win ….
And 3b, why the hell would taxes come down? Are the costs of society coming down? If property taxes go down, they still need a certain amount of revenue to maintain the cost of society. So they will have to raise taxes if the revenue from property taxes goes down.
Is anyone dumb enough to really think property taxes will ever go down in NJ?? I know there’s a sucker born every minute but jeeeezzz…
why is this so hard to understand?
why?
The Great Pumpkin says:
November 4, 2017 at 10:44 am
No, it’s not a good thing. You are missing the point. The price will come down because the incentive to purchase will be taken away. The only class of buyers left will be investors. They are the only class of buyers with the incentives still in place to own. So you will have a corporate class of owners feeding off the passive income of renters. Glad, you think the decline in home ownership is a good thing.
Grim, still not buying the sky is falling argument.
Re: landlords, if they are not currently deducting interest as an expense they’re idiots. The new rules change nothing as far as they are concerned.
Re: others actually subject to a 30% limit, that is a broadside into the Wall Street and the LBO market. “Normal” businesses won’t be captured, they don’t run that kind of leverage. Private equity is ripsh1t over this provision. Thought the lefties would like the pitchforks and torches here……
As for the cap gains on primary residence, again, cry me a river. To get tapped you need to have household income over $500k and gains over $250k. Basically looking at near 1%ers, even in this area. Thought we all wanted to tax the wealthy…here it is, guys.
Lastly, do not buy at all that taxing part of primary residence gains is going to impede job mobility. Again, we are talking about GAINS. Are we really going to make the argument that someone is not going to move to a better job because the after tax GAIN he gets from selling his residence is $70k, and not $100k? C’mon, can’t even type that with straight face.
Actually, misread it. the primary residence tax kicks in after $500k of household income and $500k of GAINS for a (married) household.
Seriously, folks, if collectively the electorate cannot agree that persons of this wealth and fortunate circumstance ought to be the group that bears any new tax burden just hang up the cleats now and forget it.
There is literally not enough wealth greater than this group to effectively tax.
Leftwing,
This article may give suggestions on outsourcing the photo equipment. Costco will also convert old photos to digital.
http://www.kenrockwell.com/tech/labs.htm
Left for years we hear talk of the locust generation yet here is something that potentially could be a benefit to the younger generation as increasing affordability for new buyers. Those who don’t have pensions and perhaps student loan debt. It could also slow property tax increases by perhaps local elected officials being more more mindful of spending. And it may hit some people who are cry about the locust generation. When it comes to money people are all the same. Talk the talk but don’t walk the walk.
I’m all for raising taxes but on someone else, right?
The top 20% in the nation can’t be considered ‘middle class’. Doesn’t work that way. LOL.
Noone, thanks for the link, scanned it looks like there might be a bunch there.
See everyone tomorrow. Off to the Cornell-Princeton hockey game, with a little tailgate action beforehand. Go Big Red!
Now that it’s legal (in MA) I wouldn’t be surprised to see some of these sitting on the porches in some neighborhoods:
https://www.youtube.com/watch?v=DyW1ATg3hlQ
3b and lefty—-hardcore conservatives. Impossible to get through to these two. Literally, impossible.
Grab them by the puzzy says:
November 4, 2017 at 11:05 am
why is this so hard to understand?
why?
Pumps — hardcore delusional. He’ll be living under a bridge and still won’t understand what went wrong but his calls were always right.
Leftwing: Re: photo/negative scanning-
I sprang for the Epson V750 pro. It is a flatbed with adapters so you can do negatives of pretty much any size up to 8×10, slides and photos. It was certainly a little pricey – but the results were well worth it. I’ve scanned 3000+ old family negatives going back to the late 30s. Yes, it was around a 2 year project. However: most of these were negatives to the old photos which were printed around 2″x2″ square back 70 years ago and now badly faded. The detail from the negative scans is amazing and I can easily get 8×10 superb prints or better – think about that, these are now images that noone in the family has ever seen in such detail, not even in the original prints.
I do use a Nikon Coolscan V for dedicated 35mm slides and negatives – I find I get slightly better results than the epson, but it’s 35mm only, and slow. I scan everyting at 2400 dpi, can go higher but not a noticable difference.
ALWAYS scan the negative vs the print if you can. I was amazed at how some of the so-so prints have excellent images on the negatives, the print labs can really screw things up and you don’t realize it.
That said, none of the home equipment will compare to a wet-mount commercial drum scan. The epson has a wet mount; I haven’t used it yet.
If sending out use the typical precautions since your irreplacable memories are at the mercy of the post office and the lab – multiple smaller batches sent separately with tracking. Get one batch back before sending another.
Left et al
My Minolta Dimage 2 is now dead an given the resolution of the Digital cameras these days is obsolete.
When I came over here 20 years ago I was working in mid town, I had all my work done at the Time Life Labs. These days I don’t shoot that much, but when I do, I shoot slide unless I need high speed and drop back to negative. ,
I use Bergen County Camera in Westwood for everything(not much) these days. One of the last true shops.
I think I’m going to head back to film and really go for it. Roll film only has a few years left. I think I’ll upgrade my old X300 and get a used Nikon F5, 50 rolls and Blog it!
@bessbell
This kind of hypocrisy really just grabs me by the pussy.
@FoxNews
In Tokyo, @IvankaTrump says sexual harassment ‘can never be tolerated’
@THR
Alec Baldwin to Harvey Weinstein on #SNL:
“He Could Have Gotten Away With It If He Was President”
They give us those nice bright colors
They give us the greens of summers
Makes you think all the world’s a sunny day
I got a Nikon camera
I love to take a photograph
So mama don’t take my Kodachrome away
I used to shoot 4×5, Velvia 100. Nothing fancy, Toyo 45cx, Rodenstock glass.
But, the slides look glorious on a lightbox, makes the best OLED displays look crude. Every time I come across the crate, I plug it in and throw a slide on. Always, always, amazes me. Even pulling out the loupe, the detail is endless.
Way too expensive these days, all that gear is gone. Back then it was $10 a shot, not including proofs, I don’t even want to know what it costs, the film probably isn’t even available anymore.
Multinationals grapple with Republican excise tax surprise – Reuters
https://apple.news/A4AzwFQ-jTgq6eVTZCG8uZg
“Fancy Bear has long been suspected of being affiliated with the Russian government, but the data shown to the AP reporters suggests both that Fancy Bear is working for the Kremlin and that it is a sophisticated cybercrime outfit, not some fat guy in his mom’s basement. The data the group was collecting would require a sophisticated team of analysts to make sense of it, and their hit list is aligned too closely with Russian state interests for Moscow to credibly deny that they have anything to do with it—though of course, they continue to do so.“
The Russian Hacking Scandal Is Way Bigger than Donald Trump – New York Magazine
https://apple.news/Are2QKnoIS5W-i-_91jj5iw
You guys still take the position you did 10 months ago, that we should embrace Russia? That putin is our friend?
What I get from this is that if it is a story attacking Clinton it is very likely BS.
https://twitter.com/Mikel_Jollett/status/926903516563509248
Some of you were acting like there is nothing to worry about with Russia. That the media just makes it seem like he is a bad guy. No, his actions do. The guy is a dictator that hijacked the Russian constitution.
Trump supporters support trumps every word, but question anything else that doesn’t come from him. He created some loyal followers. At least the ones that haven’t left him….crazy loyal. Putin was in the process of exploiting us and trump followers were so brainwashed they were like let’s befriend putin. Nuts.
Funniest part of all the fake news stuff flying around during the election was that two week period that they claimed she was in very poor health and they dismissed it. I have to imagine most of it was made up. Then she goes and faints on a 70 degree day claiming she overheated. Watching the secret service drag her limp body into that car was the turning point in the election.
Putin’s Russia is stuck in redoing the Cold War, sort of how the South still says “the war between states”, they can’t get over the fact they lost.
Putin’s issue are bigger. Dropping population, economy shot, and a lot of illegal chinese crossing and settling in the southern borders that are empty on the russian side.
We are consumed in a internal fight caused by and inflamed by replacement of kindness and character by greed and power as the defining barometer in society, mainly caused generational warfare, ideological extremism, and selfishness. In short the boomers’ moral standards run the place right now.
With that shortsighted approach, we of course are damaging our future and killing our young.
Russia is a very small piece. Bigger issue is corporate global America continual sell out and hollowing out of the USA in the search for profits. Which is destroying and eating away at the social glue of “Americaness”. Very likely leading to many social issues.
Investigation is showing that both the Las Vegas shooter and the nut that shot the Walmart a few days ago, seemed to have been extremely frustrated because everything was going “wrong” for them no matter what they did. If you ever had to deal with a suicidal person, you would notice despair powered by anger at themselves.
Same thing seems to be happening to our society. A lot of people are realizing, that the powers that be, the country, their neighbors, etc – would prefer them dead and gone. And they are acting on it. Whether opiods or shoot outs.
We as a society just need to phase out of power, the boomers with their as soon as possible. They have the generational thinking that brought this most recent bout on power and greed mentality. So no matter what they touch it would turn into sh*t.
We have to deal with the issue at home and at heart first, because otherwise by not having a societal moral reference point outside of power and greed, we would never be able to overcome the upcoming issues with China and Russia. Simply because if all it matters is power and greed. All decisions will be made and won by the highest bidder as all involve will have mercenary sensibilities and not true convictions to guide the decision making in the benefit of the USA.
In short, get rid of boomers asap. They are killing everything. Is their mindset of greed and power and lack of values for kindness and character that are the problem.
Blue,
Funniest part of the election was elected a guy who was embracing our enemy…putin. You had trump followers claiming nothing wrong with putin. Now that says a lot about how warped trump’s followers were. He could have claimed the world is flat and his supporters would have jumped on board. For god’s sake the guy that created “fake news” tried to get the world to believe that Obama is not American and that clinton’s murdered people. Now that’s the def of fake news.
Diversity NJ style. Yes, thats our Edision!
https://twitter.com/mattmfm/status/926901281368702976
All, thank you for photo recommendations! Will let you know how it turns out.
Pumpkinator,
Fantastic write up!
Wow, this report gets it. Anyone that doesn’t realize that trump is not cleaning up the swamp, just giving them more, is naive in their view of this tax reform.
“Recommendations for Reform:
Congress should repeal the rule allowing American multinational corporations to indefinitely “defer” U.S. taxes on their offshore profits. This reform would effectively remove the tax incentive to shift profits and jobs overseas.
Limit the ability of tech and other companies to use executive stock options to reduce their taxes by generating phantom “costs” these companies never incur.
Having set “bonus depreciation” on a path toward expiration at the end of 2019, Congress should take the next step and repeal the rest of accelerated depreciation, too. At a minimum, lawmakers should resist calls to expand these tax breaks by allowing for the immediate expensing of capital investments.
Reinstate a strong corporate Alternative Minimum Tax that does the job it was originally designed to do.
Increase transparency by requiring country-by-country public disclosure of company financial information, including corporate income and tax payments, through filings to the Securities and Exchange Commission.”
https://itep.org/the-35-percent-corporate-tax-myth/
Pumps seems to be going into a TDS death spiral.
Pumpkin, the Russian narrative was always fake. No one changed their votes because of Vladimir Putin…no one.
Anyone want to bet that today’s spree killer was not a member of the Christian church in Sutherland Springs, Texas where he killed 27 and injured 30 more today?
https://www.ksat.com/news/shooting-sutherland-springs-church-gunfire-mass-shooting-airlife
Calling Ms Karma, your Gazpacho is ready!
https://www.thedailybeast.com/massive-leak-reveals-new-ties-between-trump-administration-and-russia-implicating-commerce-secretary-wilbur-ross-and-jared-kushner
“Mr Martin described the suspect as a young white male in his early 20s, dressed in all black and wearing a ballistic vest as well as tactical-type gear. He was armed with an assault-style rifle.”
So not a Terr0r1st, so all we well in NRA and TrumpLand!
is well
Dude…. I was in Section 110 with my family….. I wish I knew…..
leftwing says:
November 4, 2017 at 3:04 pm
See everyone tomorrow. Off to the Cornell-Princeton hockey game, with a little tailgate action beforehand. Go Big Red!
great game….when they were down 4-2 and were short-handed, I thought they were fcuked……. this goalie Stewart seems to be a a big drop off from Gillam, but that guy was exceptional……that said, he shut them down after mid 2nd period……
Last year’s game at Baker was different…..it was in mid-January, Princeton was 3-15 or something, and Cornell was ranked……it was a Big Red home game.