Mortgages over $500k no longer receive deductions under proposed tax code

1 year 3 months 2 weeks ago Monday, November 06 2017 Nov 6, 2017 Monday, November 06, 2017 8:43:00 AM CST November 06, 2017 in News
By: Daytona Everett, KOMU 8 Reporter
loading

COLUMBIA - People in the market for a new house should keep an eye on the proposed tax code change, which will go up for debate in the U.S. House Ways and Means Committee starting Monday.

Republicans introduced the tax reform last week, which is based on cutting corporate taxes from 35 to 20 percent. But the code change has a few drawbacks, including its effect on the housing market, according to MU Economics Assistant Professor Aaron Hedlund.

“The limitation is you’re only going to be able to deduct interest on the first 500-thousand dollars of your mortgage,” Aaron Hedlund, MU Assistant Economics Professor, said.

For middle-income households, the new tax code would create fewer tax brackets and lower taxes allowing taxpayers to file on a note card, according to CNN.

“It’s going to lower rates on your income, so you’re going to have more after-tax income to spend on things including housing,” Hedlund said.

Berkshire Hathaway broker Judy Calvin said her real estate company sells several homes throughout Columbia that hit the half-million dollar mark. They’ve already sold 54 this year.

“The fourth quarter, toward the end of the year, we start seeing our much larger homes sell and that’s what we’re into now,” she said.

Despite the mortgage interest deduction cut, Calvin said the drawback is more detrimental for areas outside of the housing market such as add-ons and carpeting.

“Any tax change has to level other areas,” she said. “What’s best for all of us is not necessarily best for all.”

Hedlund said the code change would be a better option here in Mid-Missouri for the the community as a whole.

“Overall here in Columbia, when house prices are not all that dramatically high compared to some other parts of the country, the lower rates and income should really dominate,” he said. “So I would expect it to have a positive impact on the housing market here.”

Lobbyists, tax writers and Congress will sit down this week to see what the code would look like in the end and if it can get passed.




More News

Grid
List
WASHINGTON (AP) — Donald Trump was in full deflection mode. The Democrats had blamed Russia for the hacking and... More >>
3 hours ago Saturday, February 23 2019 Feb 23, 2019 Saturday, February 23, 2019 8:08:00 AM CST February 23, 2019 in News
BOONE COUNTY - Route E in Boone County was closed for about an hour Friday evening after a one-car crash... More >>
12 hours ago Friday, February 22 2019 Feb 22, 2019 Friday, February 22, 2019 10:12:00 PM CST February 22, 2019 in News
KANSAS CITY, Mo. (AP) — Court records say a Kansas City man fatally shot a woman after she made a... More >>
13 hours ago Friday, February 22 2019 Feb 22, 2019 Friday, February 22, 2019 9:27:40 PM CST February 22, 2019 in News
COLUMBIA - A fire broke out in the back of an advanced disposal garbage truck at around 2:10 pm on... More >>
14 hours ago Friday, February 22 2019 Feb 22, 2019 Friday, February 22, 2019 8:51:00 PM CST February 22, 2019 in News
CAMDEN COUNTY- A Camden County home was completely lost after an early morning fire on Friday. Mid-County Fire Protection... More >>
14 hours ago Friday, February 22 2019 Feb 22, 2019 Friday, February 22, 2019 8:47:00 PM CST February 22, 2019 in News
CENTRALIA — New numbers released by the U.S. Department of Agriculture suggest soybean farmers in mid-Missouri and elsewhere might be... More >>
15 hours ago Friday, February 22 2019 Feb 22, 2019 Friday, February 22, 2019 7:36:00 PM CST February 22, 2019 in News
COLUMBIA - A Columbia man accused of killing a woman in a head-on crash while fleeing from another wreck is... More >>
16 hours ago Friday, February 22 2019 Feb 22, 2019 Friday, February 22, 2019 7:00:00 PM CST February 22, 2019 in News
COLUMBIA — In less than a week, downtown Columbia will be filled with people attending the annual True/False Film Fest.... More >>
16 hours ago Friday, February 22 2019 Feb 22, 2019 Friday, February 22, 2019 6:33:00 PM CST February 22, 2019 in News
COLUMBIA - A recent report shows Columbia hasn't made much improvement when it comes to creating a safe and friendly... More >>
19 hours ago Friday, February 22 2019 Feb 22, 2019 Friday, February 22, 2019 3:47:00 PM CST February 22, 2019 in News
COLUMBIA — The Boone County Sheriff's Department is asking for the public's help finding 60-year-old Garland Wisley who has been... More >>
19 hours ago Friday, February 22 2019 Feb 22, 2019 Friday, February 22, 2019 3:33:00 PM CST February 22, 2019 in News
COLUMBIA - Mid-Missourians can get free help with their taxes from University of Missouri students through April 15. The... More >>
21 hours ago Friday, February 22 2019 Feb 22, 2019 Friday, February 22, 2019 2:00:00 PM CST February 22, 2019 in News
KANSAS CITY, Kan. (AP) — A judge dismissed criminal charges Friday against a Kansas water park owner and the designer... More >>
21 hours ago Friday, February 22 2019 Feb 22, 2019 Friday, February 22, 2019 1:41:00 PM CST February 22, 2019 in Top Stories
SEDALIA - A Friday search at a home in Sedalia ended with two people in custody on drug-related charges. ... More >>
21 hours ago Friday, February 22 2019 Feb 22, 2019 Friday, February 22, 2019 1:38:00 PM CST February 22, 2019 in News
COLUMBIA - The Show-Me State Games are back in Columbia starting Friday. More than 1,000 archers and 116 basketball... More >>
21 hours ago Friday, February 22 2019 Feb 22, 2019 Friday, February 22, 2019 1:18:00 PM CST February 22, 2019 in News
JEFFERSON CITY - Gov. Mike Parson is one of seven newly appointed members to the Council of Governors by President... More >>
22 hours ago Friday, February 22 2019 Feb 22, 2019 Friday, February 22, 2019 12:26:00 PM CST February 22, 2019 in News
MOBERLY — The Randolph County prosecutor charged a Moberly man Thursday with enticement of a child after he allegedly offered... More >>
23 hours ago Friday, February 22 2019 Feb 22, 2019 Friday, February 22, 2019 12:03:00 PM CST February 22, 2019 in News
(CNN) -- The producers behind Fox's "Empire" have decided to remove actor Jussie Smollett's character from the final two episodes... More >>
23 hours ago Friday, February 22 2019 Feb 22, 2019 Friday, February 22, 2019 11:37:00 AM CST February 22, 2019 in News
COLUMBIA - The Boone County Fairgrounds has three potential buyers after the lease is up in December of 2019. ... More >>
1 day ago Friday, February 22 2019 Feb 22, 2019 Friday, February 22, 2019 10:57:00 AM CST February 22, 2019 in News
Columbia, MO
Broken Clouds 42°
12pm 47°
1pm 49°
2pm 52°
3pm 54°