By The Kent Redding Group
AUSTIN, TX. – Trump Tax Reform is something that the President has been promising since he was inaugurated in January and he finally delivered his plan last month.
The big question though is if the Trump tax reform plan will either be good or bad for the Real Estate market especially since Real Estate has been one of the biggest things that’s helped the economic recovery continue in the United States.
Analyzing the Trump Tax Reform Plan
Over the last month many economists, the National Association of Realtors® (NAR), and PricewaterhouseCoopers (PwC) have had the opportunity to review the Trump Tax Reform plan and although there was an initial euphoria for lower taxes the reality is beginning to sink in that the Trump Tax Plan may not be the best for homeowners.
Homeowners with adjusted gross incomes (AGIs) between $50,000 and $200,000 (considered “middle income”) would see their taxes rise by an average of $815; non-homeowners in the same income bracket would see a tax reduction of $516, and taxpayers whose AGI is below $50,000 would see an average tax reduction of less than $100.
Homeowners with AGIs between $30,000 and $40,000 would also see a small tax increase.
On a per-return basis, taxpayers with AGI under $50,000 would see average tax reductions of less than $100, and taxpayers with AGI over $200,000 would see average tax decreases of more than $15,000.
Non-homeowners across all income categories would, on average, see their taxes decrease.
Home values could fall by as much as 10 percent in the near term.
Taxpayers (including both homeowners and non-homeowners) with AGIs between $75,000 and $250,000 would pay higher income taxes on average. Other income categories would see income tax reductions.
On average, households with mortgage balances between $100,000 and $500,000 would see income tax increases.
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