Tax Reform Bill Lowers Mortgage Interest Deductions

In late December, the U.S.  House of Representatives and Senate  passed  the congressional tax reform bill. It was  signed  by  President  Trump  and went into effect January 1.  The final tax plan reduces the limit  for  the  mortgage  interest  deduction  from $1 million to $750,000 on mortgages for a first or second home and caps the deduction of state and local  tax  deductions,  including  property,   sales, and income tax, at $10,000. The  lower  mortgage  interest  deduction cap punishes home buyers in  high-cost  states,  such  as  California, and maintains provisions that weaken homeownership tax incentives.

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