Our client’s voice was literally fraught with fear and panic at the prospect of possibly losing his mortgage interest deduction that he normally takes on his taxes each year. After trying to interject my thoughts about this subject, I knew I had to sit back and simply listen to everything he wanted to say. Basically, I was unable to get any words in edge-wise. So I sat back and listened to him rant and rave about the injustice of this proposed fiscal cliff legislation.
He’s not alone. Many Americans are left wondering about the economic times ahead. What are the facts about higher taxes and the elimination of certain itemized deductions that seem like staples to the United States tax system?
I do not have all the answers. And I recommend that each individual consult his or her tax accountant or attorney regarding these matters.
But I will share what I do know so far.
According to the National Association of Realtors, “there is a permanent repeal of Pease Limitations for 99% of Taxpayers.”
From the NAR: “Under the agreement so called ‘Pease Limitations’ that reduce the value of itemized deductions are permanently repealed for most taxpayers but will be reinstituted for high income filers. These limitations will only apply to individuals earning more than $250,000 and joint filers earning above $300,000. These thresholds have been increased and are indexed for inflation and will rise over time. Under the formula, the amount of adjusted gross income above the threshold is multiplied by three percent. That amount is then used to reduce the total value of the filer’s itemized deductions. The total amount of reduction cannot exceed 80 percent of the filer’s itemized deductions.”
To purchase a home in Colorado Springs, feel free to contact our Colorado Springs professionals at Selley Group Real Estate, LLC: 2139 Chuckwagon Rd, Ste 210 - Colorado Springs, Colorado 80919 - 719. 598. 5101
All agents affiliated with Selley Group Real Estate, LLC are actively licensed in accordance to the laws of Colorado.
Portions of this article are written by Gordon, as framed by the expressed opinions of Cherise, but not proofread.