Ocean City Today
https://oceancitytoday.villagesoup.com/p/1710049

Tax reform: some confusion likely

EDITORIAL
Dec 07, 2017

 

 

printed 12/08/2017

 

The article last week on how the congressional tax reform effort could affect the real estate market was unclear, in that the story’s structure left open the possibility that someone might misconstrue Coastal Association of Realtors President Joel Maher’s comment to mean the mortgage interest deduction is going away.

It isn’t, but it will be capped in both the tax reform packages passed by the Senate and House.

In the Senate’s bill, that cap would limit the interest deduction to mortgages of $1 million or less, while the House measure would set the ceiling at $500,000.

At least, that’s where things stand now, before the Senate and House get together to merge their versions into one all-encompassing measure.

It’s understandable, however, that some confusion would arise, as it’s unlikely the average member of congress has read every one of the 900-plus pages of the two proposals.

Just as the massive Affordable Care Act legislation was brought to the Senate floor by the Democrats in 2010 and voted on before most members could even read it (assuming they were so inclined) the same approach was used this time by the Republicans, again assuming reading it wouldn’t have made any difference in their votes.

This is, to put it mildly, a hell of a way to run a country, when the people who are responsible for governing believe the best way to proceed is the legislative equivalent of shooting first and asking questions later.

This doesn’t mean the tax reform effort is all good or all bad. Like all legislation, it has its upsides and downsides, depending on one’s personal circumstance. But as for what it will actually do? It’s complicated and can’t be known until its hundreds of pages come to bear in the real world.

As Forbes magazine contributing writer and tax expert Tony Nitti wrote recently, “The next time you hear any politician — Republican or Democrat — decry the complexity of the current tax law and promise to overhaul the Code in a way that leaves it simple, just ignore them.”

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