Republican Tax Bill Expected To Impact Property Tax Deductions

Limits deductions to 10,000 dollars a year

WTVO/WQRF - For sale signs can be seen outside homes on National Avenue in Rockford. The properties are enticing as the backyards look out on to the Rock River. But, even if it's in your price range, new legislation could make it more expensive on your tax book.

"Anything that limits a home owners benefits is going to be a concern to my profession or to all real estate agents in general," said Frank Wehrstein, President of Dickerson and Nieman Realtors, on the potential drawbacks that could come with the proposed GOP tax overhaul.

The bill limits home owners to only deducting the first ten thousand dollars from their property taxes."To get to 10,000 in taxes your house would have to be in between 250 and 275," said Wehrstein.

That tax rate is high in Rockford compared to most other cities. 'Business Insider' magazine ranked the worst cities for homeowners to live in under the Republican tax bill, Chicago was number eight.
In order for a home in the windy city to see a lost deduction, it has to cost roughly double than a home in Rockford at 519,000 dollars.

Had Rockford been included, it would have easily topped the list. With a real property tax rate nearly double Chicago's. So prospective home buyers need to keep taxes in mind. "The first advice I would give them would be when they start the search, would be to talk to their accountants," Wehrstein said. "Their accountant will be able to spell it out very clearly for them what the benefits will or won't be," he added.

While property taxes in Rockford are high, Wehrstein says home prices can help make up for it. He says most buyers won't pay more than 10,000 in property taxes.

"Even though the taxes are lower, the price of the house is significantly higher," Wehrstein said. "Here our taxes are higher, but the entry to get in is not near what it would be in some of those larger markets," he added.

The GOP Tax Bill is expected to be voted on by the end of a week. Below is a link the Business Insider article.

http://www.businessinsider.com/trump-tax-bill-makes-these-cities-the-worst-for-homebuyers-2017-12

 

 


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