Unsettling Times for Property Owners
For one of the least productive congressional sessions in modern history, the final word about tax reform last week was entirely in character: Nothing’s happening.
But is that good news or bad news for homeowners, buyers and small-scale real estate investors? A bit of both.
When House Ways and Means Committee Chairman Dave Camp, R-Mich., announced that not only will he not reveal the details of his long-awaited comprehensive tax reform bill this year but he also will not seek passage of a so-called “extenders” bill for expiring tax-code benefits, it was a sweet and sour mix for real estate interests.
Camp’s big reform bill, which would attempt to lower individual and corporate income tax rates to a maximum of 25 percent, is expected to call for significant cutbacks — possibly elimination — of prized deductions for home mortgage interest, local property taxes and other write-offs in order to pay for lower marginal rates. With major changes like these now pushed back well into 2014 for even preliminary debate — in the middle of a re-election year for Congress — homeownership advocates are at least moderately relieved.
But there’s a key negative here as well: The failure of tax writers to put together an extenders bill means that important expiring Internal Revenue Code provisions affecting large numbers of homeowners — especially relief from taxation on mortgage debt forgiveness by lenders in most states, plus current deductions for mortgage insurance premiums and energy-saving home improvements — will lapse Dec. 31.
read more at: http://www.utsandiego.com/news/2013/Dec/15/tp-unsettling-times-for-property-owners/?#article-copy
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