Will it help to itemize deductions – Part 2?
- March 19, 2019
- David Greene
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Last week I discussed the standard deduction changes and this week we’ll take a brief look at itemized deductions. Many deductions are still allowed but limited. Foreign income taxes, state and local real and personal property taxes, and state and local income taxes are limited to a total of $10,000 all together, not each. The actual total amount is allowed, however, if they were incurred in a business. Foreign real property taxes are not all owed unless incurred as part of a business. Home purchase money mortgage interest is limited to purchases of $750,000 or less. The interest deduction of home equity loans is eliminated unless the loan is made to improve the home. Personal casualty and theft loss deductons are eliminated unless the loss is due to a federally declared disaster. On the good side, the deduction for medical expenses will be available for taxpayers if they are greater than 7.5% of the taxpayer’s AGI; however, after 2018, the threshold will return to 10%. This is just a brief look at some of the changes to itemized deductions. You should consult a professional if you have any particular question.