Update on 2018 Tax Changes.
1. Capital gains exclusion. In a huge win for current and prospective homeowners, current law is left in place on the capital gains exclusion of $250,000 for an individual and $500,000 for married couples on the sale of a home. Plans to make it much harder to qualify for the exclusion did not pass.
2. Mortgage interest deduction. The maximum mortgage amount for households deducting their mortgage interest has been decreased to $750,000 from the current $1 million limit. A House bill sought a reduction to $500,000.
3. State and local tax deductions. Bills sought to eliminate the state and local income tax deduction, but both property taxes and state and local income taxes remain deductible, although now with a combined limit of $10,000.
Happy New Year!