Changes to the SALT Deductions – How will Delaware homeowners be impacted?
In today’s Ask The Broker video, I discuss the recent changes in the tax law regarding SALT (State and Local Tax Deductions) and what kind of impact it will have on Delaware homeowners and those in the Mid-Atlantic states.
Today’s topic is very topical, is SALT and how it might impact you if you live in Delaware. This is certainly a very top of mind discussion that everybody’s been having over the holidays. SALT, which stands for the State and Local Tax deduction, has a major impact on a lot of the folks that we typically see considering moving to Delaware. So people from New York, New Jersey, Connecticut, Pennsylvania, Maryland, Massachusetts, many states in the Mid-Atlantic and Northeast region are going to be greatly impacted by the changes to the SALT tax deduction limits.
Let’s check out this report from Wallethub.com which ranked the 2017 real estate property taxes in each state. And as typically happens, Delaware is ranked at the fourth best for lowest property taxes. The best on this list is Hawaii, which wouldn’t be bad. In second was Alabama; third is Louisiana; followed by Delaware at number four. But even probably more telling is when I look at the bottom of that list of property tax rankings. New Jersey is way down the bottom at number 51. Connecticut sits at number 48. New York is at 41. Pennsylvania is at 39. Massachusetts at 34. And Maryland ranked at 30. Again, this shows that those are the states that are going to be greatly impacted by the SALT deduction changes. That is because the combination of your state and local taxes in those regions, I hear, is usually much greater than $10,000, which is the new deduction limit you can take on your Federal Tax Return.
Even if you were to buy a luxury home here at the beach in Delaware, every bit as luxurious as the one you may already have in Connecticut, Long Island or at the Jersey Shore, I’ve never seen a tax bill over $10,000 in Delaware. And that’s for the most expensive, the nicest home that I could possibly ever imagine. Moving to Delaware, you can certainly find something comparable and know that even if you can afford it, you’re not going to be paying more than that $10,000 in property taxes that will be totally deductible on your federal income tax.
In my opinion, affordable or not is something we all have to ask ourselves. But Delaware still comes out in the right place. If you are are interested in moving to Delaware, let our real estate agents here at Active Adults Realty, show you the areas and show you things that would be comparable so that you can make an informed decision. And know that if you move to Delaware, the only salt you’ll need to be concerned about is on the roads for those very occasional snowstorms like we just had.
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