Friday, November 3, 2017

Featured in a KCRA3 story about the federal tax reform proposal...

The new federal tax reform proposal was announced this week, and there are some major ramifications for homeowners if this passes in its current form. I was interviewed by KCRA 3 News specifically regarding the proposed cap on the Mortgage Interest Deduction (MID).

Under current tax law, homeowners may write off mortgage interest on mortgages up to $1,000,000. The new tax proposal seeks to reduce this to mortgages up to $500,000. So what's the big deal about this? California is a "high cost" state...While the current median home price for September 2017 in Sacramento County is $348,000, there are plenty of higher priced areas in and around Sacramento, such as Davis, El Dorado Hills, Granite Bay, East Sacramento, Land Park, Arden Park, Sierra Oaks, and others.

Additionally, the median home price for the entire state of California is $555,410. That means that more than half of all home sales in California are more than $555,410. That means that potentially more than half of all home sales in California may be affected by this cap and owners potentially will suffer some reduction of mortgage interest deductibility.

I would urge you to research the tax plan and ask your congressional representative to reconsider elements of the plan that may adversely affect homeownership. View the news story here.

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