On Friday, December 15, the new and final version of the tax overhaul plan was released and may affect individual filers if the bill is passed.
If passed, NPR reported that the tax plan “limits taxpayers to deducting the interest on new mortgages up to $750,000, as opposed to $500,000 in the House bill and $1 million in the Senate bill, which is also the amount set under current law.”
The charts shown above compare the proposed tax brackets to the current law.
So how will tax plan affect homeowners?
NPR shared that “the top rate would fall to 37 percent from 39.6 percent, and fewer households would pay that top rate.”
With the current law, “Homeowners who itemize their deductions can deduct the interest paid on up to $1 million of their mortgage principal.”
With the “The deduction would be limited to up to $750,000 of new mortgages, not $1 million. It would allow homeowners to deduct the interest on mortgages from both first and second homes and would not affect existing mortgages. The provision would expire after 2025.”
Learn more about the new tax code and how it would affect different groups of Americans. https://www.npr.org/2017/12/15/571258698/chart-how-the-new-version-of-the-republican-tax-bill-would-affect-you.
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