Tax Bill

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bedraggled
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Tax Bill

Post by bedraggled » Thu Nov 02, 2017 1:07 pm

Hey, does the proposed mortgage interest limitation down to $500K take some of the sizzle out of the Manhattan, Boston, Seattle, San Francisco, etc. housing markets?
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pugchief
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Re: Tax Bill

Post by pugchief » Thu Nov 02, 2017 2:30 pm

bedraggled wrote:Hey, does the proposed mortgage interest limitation down to $500K take some of the sizzle out of the Manhattan, Boston, Seattle, San Francisco, etc. housing markets?
We can only hope.
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buddtholomew
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Re: Tax Bill

Post by buddtholomew » Thu Nov 02, 2017 6:05 pm

I glanced at the 429 page bill and I think there was some reference to first time buyers only (down from 1M to 500K).
Libertarian666
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Re: Tax Bill

Post by Libertarian666 » Fri Nov 03, 2017 10:24 am

I think they are about to have the air let out anyway. Of course this might be blamed, but it isn't the cause.

The cause is that the real estate bubble has been blown up even bigger than in 2008.
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Kriegsspiel
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Re: Tax Bill

Post by Kriegsspiel » Fri Nov 03, 2017 10:28 am

bedraggled wrote:Hey, does the proposed mortgage interest limitation down to $500K take some of the sizzle out of the Manhattan, Boston, Seattle, San Francisco, etc. housing markets?
Tyler Cowen says yea:

"we should tax companies less and homes/land more. Why? First, for behavioral reasons homeowners are insufficiently diversified; the tax code should not encourage that. Second, this bill will (modestly) lower land, home, and rental values in the fancy cities on the coasts, a net gain at least for non-itemizers perhaps (caveat: I don’t know everything that is in the bill). Third, big, fancy homes on big plots of land are not that “green,” and furthermore residence size seems to bring a lot of hedonic adaptation. Fourth, there are more likely increasing returns across companies than across expensive homes. Fifth, American equities seem to bring a long-run return of 5-7% and real estate zero percent. More of the former please! Companies > homes."
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sophie
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Re: Tax Bill

Post by sophie » Fri Nov 03, 2017 11:43 pm

I've got mixed feelings about the tax proposal. I live in the worst possible place for it (New York City). According to the calculator below I can expect about a $3,000 tax increase if this plan passes - possibly more, depending on the impact it has on NY tax forms.

https://www.calcxml.com/calculators/tru ... calculator

However, I do recognize that the federal government should not be subsidizing high tax habits. This may be the silver lining that produces some savings down the line. High tax states are going to have to rein in spending and cut taxes. New York has been bleeding middle to high income residents for decades, something like $20 billion in total income per year, and fortunately our current governor has demonstrated that he understands this to be a serious problem. (the state senate and NYC mayor, unfortunately, do not.)

So it'll be like ripping off a bandaid. Hopefully it'll be worth it.

BTW I doubt very much it will depress NYC housing costs. There is not, in fact, a bubble here. There's a limited, relatively fixed housing supply, and no shortage of people who want to live here. At least for now!
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ochotona
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Re: Tax Bill

Post by ochotona » Sat Nov 04, 2017 6:37 am

Sorry, taking away deductibility of catastrophic health expenses and long-term care is just plain evil. I believe that sh** is in there. Kick a cancer patient or Alzheimer sufferer and their family when they're down. More to the 1%. This process makes me sick.
Libertarian666
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Re: Tax Bill

Post by Libertarian666 » Sat Nov 04, 2017 7:00 am

ochotona wrote:Sorry, taking away deductibility of catastrophic health expenses and long-term care is just plain evil. I believe that sh** is in there. Kick a cancer patient or Alzheimer sufferer and their family when they're down. More to the 1%. This process makes me sick.
That is a terrible idea. Hopefully it will be thrown out of the final bill.
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ochotona
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Re: Tax Bill

Post by ochotona » Sat Nov 04, 2017 8:11 am

Libertarian666 wrote:
ochotona wrote:Sorry, taking away deductibility of catastrophic health expenses and long-term care is just plain evil. I believe that sh** is in there. Kick a cancer patient or Alzheimer sufferer and their family when they're down. More to the 1%. This process makes me sick.
That is a terrible idea. Hopefully it will be thrown out of the final bill.
Write and tweet to your Congresscritters.


Congressman,

Sorry, taking away deductibility of catastrophic health expenses and nursing homes is just plain evil.

We need to get rid of the extra Collectibles Tax on capital gains for gold and silver.


Repeal excess GPO / WEP tax on Social Security recipients who were teachers, firefighters, and police.

Sincerely
Ochotona
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sophie
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Re: Tax Bill

Post by sophie » Sun Nov 05, 2017 7:13 am

TennPaGa wrote:For me, the deductibility of state and local taxes is an application of federalism. That is, it seems reasonable that state taxes would take precedence, and it also seems reasonable that the federal government would not count such taxes toward the basis of federal taxes.

FWIW, state and local taxes have been deductible since the advent of the federal income tax.
Interesting viewpoint. I was thinking more pragmatically. I've heard "don't worry, you can deduct it on your federal taxes" too many times as a reason why I shouldn't be concerned about the annual 10-15% property tax increases. I'm also thinking it may spur New York to fix its underlying problem: a state population that is being drained of income earners and replaced with Medicaid/welfare recipients. Over a third of NYS's population is on Medicaid, meaning that I personally am footing the bill for 50% of someone's health insurance.

In Canada, most people file their taxes by filling out a postcard (per my sister; Canadian forum members may wish to comment). I think that's the goal here. Is it worth giving up the deduction structure that we have come to depend on, along with the high expense it entails in both the public and private sectors? Don't know the answer to that but I hope this will frame the debate over the tax bill. It was not promising that I've already read something about a special provision being added to the bill next week to appease car dealers.
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ochotona
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Re: Tax Bill

Post by ochotona » Sun Nov 05, 2017 7:20 am

I don't see a large chance of this thing becoming law. But if it does, and the stock market responds with a rally, that would be the rally to sell, honestly. Long Treasuries and Gold would decrease. If near a rebalancing point, maybe pull the trigger then. Buy the rumor, sell the news.
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