Friday, November 17, 2017

Taxes?


Taxes have been in the news. 

My view is that if a politician's lips are moving, they are lying. 

The tax reform appears to be an attempt to buy the American populace by trying to proposing a tax plan that appears to offer something for nothing.

As I dig into the plans out there, I find that true middle Americans are likely lose under the plans. Those of us who own our homes and try to pay our bills on time are going to be expected to fund the tax deductions for everyone else.

Some of the real problems in the bills:

Loss of the ability to deduct state income taxes--that is a 7 percent hit here in Maryland. 

Fortunately, the Representatives realized that home ownership is the bedrock of our economy and kept in deductions for mortgage interest and taxes--albeit reduced, the reductions should not affect most middle class Americans.

Here is a summary from The Washington Post:

About 30 percent of filers itemize. Most of the people who itemize claim the state and local tax deduction (SALT) where they deduct their state and local sales, income and property taxes. Under the House bill, only the property deduction would remain. This hurts people living in high-tax (and often blue) states like New Jersey, New York and California. Several GOP representatives from these states plan to vote no on the bill in protest.
The adoption credit stays. The 401(k) exemption stays. But . . .
Say goodbye to the tax credits for plug-in motor vehicles. It gets repealed in 2018.
Say goodbye to the deduction for medical expensesIt goes away in 2018.
Say goodbye to being able to write off the costs of your tax preparer. That goes away in 2018.
Say goodbye to the deduction for moving expenses. It goes away in 2018, except for members of the military.
Say goodbye to most tax benefits for college. 
I am not sure how this is going to be a tax reduction. And i clearly am not going to be buying a Tesla in the future.

-- Bob Doan, Elkridge, MD  

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