Tax reform may be boosting demand for Florida real estate

Luxury real estate sales in Florida could get a boost from a rule in the federal tax bill that President Donald Trump signed into law in December.

The rule caps “SALT” or state and local tax deductions at $10,000, when before those deductions were unlimited. Those include real estate, and either income taxes or sales taxes. For wealthy people who itemize deductions, income taxes alone exceed that amount, let alone property and sales taxes. If they also live in a relatively high tax state such as New York or New Jersey, that could make officially declaring Florida their “home” a more attractive proposition because it has no state income tax.
Luxury properties in Collier County have been hot in the first quarter; some feel the $10,000 cap may have played a part. Home sales priced above $1 million in Naples during the first three months of the year were up 61 percent, according to the Naples Area Board of Realtors, and pending sales of condominium’s priced at $2 million or more were up 109 percent from the same time last year.
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Hurricane victims: A recap of key IRS tax relief

WASHINGTON – Oct. 10, 2017 – The Internal Revenue Service (IRS) offered a rundown of key tax relief available to victims of Hurricanes Harvey, Irma and Maria. In general, the IRS relief to individuals and businesses applies anywhere in Florida, Georgia, Puerto Rico and the Virgin Islands, as well as parts of Texas.
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How would tax plan alter mortgage interest deduction?

WASHINGTON (AP) – Oct. 11, 2017 – Each year, taxpayers subsidize America’s homeowners by roughly $70 billion, with the benefits flowing disproportionately to coastal areas with high incomes and pricey homes, from New York and Washington to Los Angeles and San Francisco.

The subsidy for homeowners comes in the form of a deduction from their taxes for the interest they pay on their mortgages. An affluent New Yorker, for example, would have saved an average of $3,694 in 2015, according to an analysis of IRS data released Wednesday by the real estate company Apartment List. In metro Los Angeles, the deduction was worth an average of $4,568, in San Francisco still more: $5,500.

But under President Donald Trump’s tax proposal, some Americans would likely be steered away from this tax break. Here’s why: Trump’s plan would double the standard deduction, which taxpayers can take if they don’t itemize deductions. The doubled standard deduction could exceed the savings many receive now from itemizing their expenses for housing, state and local taxes and related costs.
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