CLE Presentation by Shamsey Oloko
Interest on Home Equity Loans Often Still Deductible Under new Law
Interest on Home Equity Loans Still Deductible Under New Law
The Internal Revenue Service today advised taxpayers that in many cases they can continue to deduct interest paid on home equity loans.
Responding to many questions received from taxpayers and tax professionals, the IRS said that despite newly-enacted restrictions on home mortgages, taxpayers can often still deduct interest on a home equity loan, home equity line of credit (HELOC) or second mortgage, regardless of how the loan is labelled. The Tax Cuts and Jobs Act of 2017, enacted Dec. 22, suspends from 2018 until 2026 the deduction for interest paid on home equity loans and lines of credit, unless they are used to buy, build or substantially improve the taxpayer’s home that secures the loan.
The $10,000 SALT Limit and the Rental Real Estate
The $10,000 SALT Limit and the Rental Real Estate
Under the recently enacted Tax Cuts and Jobs Act, State And Local Tax (SALT) deductions are limited to $10,000. How does this affect the individual taxpayer?
QUESTION: Are SALT payments made on my rental real estate subject to the $10,000 cap?
ANSWER: Generally, under the old law, all SALT payments were deductible. However, the new law caps deductible SALT at an aggregate of $10,000 for individual taxpayers.
OF SALT, TAXES & MORTGAGES…
OF SALT, TAXES AND MORTGAGES…
Do you pay State and Local Taxes (SALT)? If you live in any of New York, California, New Jersey, Connecticut, or any other of the so-called high-tax states, you likely pay more than the national average in SALT. Prior to 2018, you were allowed to itemize all of your SALT payments on your federal tax returns. However, the recently passed law, the Tax Cuts and Jobs Act, curbs the deductibility and otherwise affects you disproportionately, compared with the rest of the country. The changes to the deduction of State and Local Taxes (SALT) on federal tax returns are generally as follows
AN ANALYSIS OF THE TAX CUTS AND JOBS ACT
January 2018
AN ANALYSIS OF THE TAX CUTS AND JOBS ACT
On December 22, 2017, after much, well-publicized legislative skirmishes, President Donald Trump signed into law H.R. 1, otherwise known as the “Tax Cuts and Jobs Act.” Provisions affecting individuals are generally effective beginning December 31, 2017 and expire on December 31, 2025. Most business-related provisions are permanent and are effective beginning December 31, 2017.
This new law is, by all accounts, the most significant revisions to the U.S. tax code since 1986, affecting almost all individual and business taxpayers. Our firm’s general assessment of the new law will therefore be a two-part series: this first part covers changes to individual taxpayers, and the second part will cover changes to business taxpayers.
About The Internal Revenue Code
Federal tax law begins (and ends!) with the Internal Revenue Code (IRC or “Tax Code”), which was enacted by Congress in Title 26 of the United States Code (26 U.S.C. et seq). The Tax Code, formally known as the Internal Revenue Code of 1986, contains the federal domestic statutory tax law of the United States.
The Internal Revenue Code is organized by such topics as income tax, payroll tax, estate tax, gift tax, and excise tax. The Tax Code also contains rules for procedure and administration. As everyone soon finds out after earning their first paycheck, if not sooner, the agency responsible for administering its rules and associated regulations is the Internal Revenue Service, aka IRS.
History of The Income Tax In The U.S. Part 4: 2008-2016
Here is a quick summary of the history of the income tax in the United States up to the Obama presidency. Please see past blogs on the history of the income tax in the United States for more information.
Taxes were not much a part of our nation’s early history until the high cost of the War of 1812 brought about a need for revenue at the federal level, which resulted in the implementation of the nation’s first sales taxes. Fifty years later, Abraham Lincoln enacted emergency measures to pay for the Civil War.
History of The Income Tax In The U.S. Part 3: 2000-2008
Ronald Reagan ran for president on a platform of tax reform. In the fall of 1986, President Reagan signed into law the Tax Reform Act of 1986, one of the most far-reaching reforms of the U.S. tax system. More than ten years later in 1997, President Clinton signed the Taxpayer Relief Act which reduced taxes by $152 and implemented more than 800 changes to the Tax Code rules and regulations, including a $500 per child tax credit, capital gains tax reduction, Roth IRAs and tax incentives for education. Following the passage of these major tax bills, significant tax legislation was also enacted during the presidency of George W. Bush. This blog examining the tax history of the U.S. will examine the legislation enacted during his time in office.
History of The Income Tax In The U.S. Part 2: 1980-1999
As perhaps would be expected, taxes were not much a part of our nation’s early history. Then the high cost of the War of 1812 brought about a need for revenue at the federal level and the nation’s first sales taxes were implemented. Fifty years later, Abraham Lincoln enacted emergency measures to pay for Civil War. In 1954, the 875-page Internal Revenue Code of 1954 was formulated. It was perhaps the most monumental overhaul of the federal income tax system to date. In 1969, the Tax Reform Act contained major amendments to the 1954 Tax Code.
Reagan-Bush Era
History of The Income Tax In The U.S., Part 1: The First Two Hundred Years
Our nation has existed since 1776. Some wonder whether the income tax has been around for as long. As perhaps would be expected, taxes were not much a part of our nation’s early history. After all, the Boston Tea Party involved a protest over a tariff, the Tea Act of 1773, imposed by the English crown. In the period directly preceding the 19th century, the United States imposed internal taxes on distilled spirits, tobacco, refined sugar, slaves, carriages, corporate bonds, snuff, and property sold at auction.
The 19th Century