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Comment by mmanfrin | Hacker News Reader

I'm a highish earning single homeowner in Alameda County (Bay Area) -- between the Mortgage Interest deduction, the Property Tax deduction, and the State Income Tax deduction being slated for removal, my taxable income is about to go up something like $60k, which is a large chunk of my actual income. This tax bill utterly fucks me, to the point I'm considering selling my house to get ahead of the inevitable housing crash.

I cannot see this bill as anything short of theft. Why do I have to pay double-digit percentage more on my taxes to give the ultra rich a tax cut? In what fucking world does that make any economic sense.

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There are numerous items written by economists that discuss in detail why state and local taxes and mortgage interest should not be deductible from federal taxes. It's very highly agreed upon. Perhaps you should seek out some of this literature.

I also strongly suspect that you are overestimating the magnitude of the tax increase you will see but if course it's very hard to know without the details of your particular financial situation. In particular I will note that the mortgage interest deduction is grandfathered in for current homeowners and the elimination only applies to loans over 500k (and that's only in the house bill. the deduction remains completely in the senate bill. it remains to be seen what happens in reconciliation).

That's all fine, but IN CONTEXT, OP is still getting robbed. They're paying higher taxes while the super-rich pay lower taxes.

They could have passed a bill that eliminated those deductions and gave corresponding tax breaks to the middle class. They could have passed a bill that skipped the tax breaks for the super-rich and actually cut the deficit. I'm OK with paying my fair share if we were actually solving problems.

But no. We've gotta pay higher taxes while still blowing a hole in the deficit? In what world does that make sense?

There are tax breaks to the middle + lower classes. Lower bracket rates are lowered, the standard deduction (which is used by people on the lower end of the income spectrum much more) is dramatically increased, and the child tax credit is increased.

> There are tax breaks to the middle + lower classes.

The net impact is a tax increase on the very poorest in the short term; and on pretty much the whole segment up to a bit above median income over the 10 year period. Yes, there are individual provisions that, taken in isolation, benefit the working class, but in net it's a loss not a gain.

1) If we're also talking about how the cost of health insurance might change then you could be correct about the very poorest. It's a bit hard to say.

If we're only talking about taxes paid, then you are wrong there.

2) I think that the whole "over the 10 year period" is a bit of a red herring. The US tax system isn't getting set in concrete with the (potential) passage of this bill. Numerous things will almost certainly change over the next 10 years. Tax breaks set to expire will get extended. Rates will get tinkered with. It's hard to know what might happen. Because of this I think the short term effects matter much much more than what is theoretically set to happen in 10 years.

Regarding 2:

This tax law has specifically baked in expirations of some portions. When they come up for renewal the GOP will whine and moan about the unbalanced expenditures and they'll either lapse or be supplemented with additional cuts, the corporate side of these cuts is not subjected to this.

It's fine to say "Oh, things may change down the road" but today they designed a tax cut that will benefit the rich, I do hope we're saved from this ridiculous hand out down the line, but that will be by the actions of other people, these politicians have written the bill as they desire it.

Specifically, what will happen is Democrats will have to clean up the mess, and the GOP and their cheerleaders will call the fix 'job killing tax hikes'.

But that's later! Right now it's a red herring to call the mess a mess.

> When they come up for renewal the GOP will whine and moan

They didn't do this in 2013 when some of the Bush tax cuts expired. There is little reason to think that they will do so in this case.

The relevant quantity is standard deduction + personal exemption(s) which is barely increasing for single people and declining drastically for families.

The main argument is that richer people buy more expensive houses and get bigger deduction then lower income people and basically lower income people are subsiding rich people mansions. BUT there is a cap which I would guess would work good enough to mitigate this.

Also people who buy are subsidized by those who rent. We don't need a cap, the deduction shouldn't exist at all. In fact, homeowners should pay taxes on imputed rent like they do in The Netherlands, Iceland & Switzerland.

>pay taxes on imputed rent

What does this mean? Rent that the home would go for?

Yes.

https://en.wikipedia.org/wiki/Imputed_rent

Thanks.

I wonder how that would work out in LA where we already have high rents, high houses prices, and lower wages.

I don't quite know how much one can deduct off their mortgage in taxes but I would assume the imputed rent would be a similar amount in such a market?

> There are numerous items written by economists that discuss in detail why state and local taxes and mortgage interest should not be deductible from federal taxes. It's very highly agreed upon. Perhaps you should seek out some of this literature.

Could you show at least one? When I look for this, I don't see articles supporting your position.

https://fivethirtyeight.com/features/the-tax-deductions-econ...

California is the insane state with created the taxes. The government is trying to simplify the tax code, that means you should be able to say: "I'm taxed at 15%, and that means out of $100k you get $85k take home" Not all the deductions.

I'm not really, for or against this bill. I used to live in Alameda, CA and thought the taxes were insane. The bag tax, the income tax, the property tax, literally if you didn't have deductions out of $100k you might have a $30k take home. That's the crazy part.

Perhaps we should rethink the government being the biggest employer, and actually make taxes simple and uniform.

> literally if you didn't have deductions out of $100k you might have a $30k take home.

That is just not true. Up until very recently, I had ZERO deductions I could take. I made over $100k in San Francisco and my take home was about 65% of my income.

If you paid state income tax, you should have been able to deduct that at the very least (probably around 6k, or about the same as the standard deduction).

which makes it not worth the paperwork effort to do so.

Are you kidding me? $6k deductions is about $2k in rebates. A $150 accountant fee would take care of any paperwork. Taxes aren't that fucking hard.

6k in deductions is equal to the standard deduction

The effort is something like filling in one line, adding up a handful of numbers, copying the result to another line, selecting which of two numbers is larger and copying that one to another line.

That hardly even merits the word "effort"...and if you are using tax prep software instead of filling out the forms by hand it isn't even that...it's just entering one number in one field.

why would you file itemized when your deductions are less than the standard deduction?

I would always try to itemize my deductions, but every time the standard deduction always ended up being more.

Simplification is a red herring (notice how corporate state taxes are still deductible). Republicans needed a pay-for for reducing corporate/passthrough taxes and eliminating the estate tax. It just so happens that high wage earners in high tax states tend to be Democrats.

> The government is trying to simplify the tax code

False; the tax reform creates a whole host of new targeted tax breaks; it's not about simplification, just moving the tax burden. And, in net, moving it to the poor.

Reducing the number of brackets and removing a few of the simplest deductions while mostly leaving untouched or even increasing the hundreds or thousands of deductions that are generally only usable by companies and very wealthy people is not in any meaningful way simplifying the tax code.

Good luck, every single prop aimed at raising the California income taxes passed overwhelmingly. The financial bind of those who make $200,000 and live in SF is not quite shared by voters in San Bernardino, Sacramento or even east LA.

It might also turn out that the pension plans for state employees, teachers, prison guards and police have been underperforming, and unless those pension funds loaded up on Bitcoin at the right time, the California taxpayers are on the hook to make up the difference.

There’s a silver lining, of course - once the high-speed rail is completed, the ticket revenues for the masses excited to go between LA and SF will surely pay for everything.

>>It might also turn out that the pension plans for state employees, teachers, prison guards and police have been underperforming

More like they award themselves pensions that can be funded through these means. For eg: http://www.mercurynews.com/2016/11/01/bart-janitor-grossed-2...

There are many such articles written over the years, including those by Arnold Schwarzenegger, about the impossibility of paying pensions the tune to half a million dollars a year per person, for decades(Given how long people live these days).

Unions graciously award over time to employees to inflate their net compensation package in the last few years(as that is what decides the pensions).

Even productive people, who are at the peak of their performance struggle to make $500K/year. Paying that kind of cash for every single person disproportionate to the value they create/created is possible by only one means- Taxes.

>>Perhaps we should rethink the government being the biggest employer, and actually make taxes simple and uniform.

And pensions.

Pretty much bulk of the tax money collected goes out to pay pensions and various other social security benefits, which people awarded themselves way back in time assuming the coming generations will happily pay for with taxes.

Nobody and nothing can satisfy people who think they are entitled to free money.

People have been clamoring for more taxes on the rich. Well, this is what it looks like.

Oh wait! You didn't think you were rich, right?

Depends on if you mean rich for California, rich for the USA, or rich for the world.

Oh wait! They didn’t think wealth was relative, right?

No, this is a hit on the upper middle class. The actual rich aren't feeling the pain.

Spoiler alert: if you make over $200,000 a year, you are the rich compared to most of the rest of the country.

I love that a factual statement is getting downvoted, btw. Get a grip on your frame of reference, HN.

Rich is relative to housing costs.

Feel free to move.

Your $200,000 a year will get you by very nicely here in the Midwest. We even have jobs and accept the same currency you're paid in over in SV, imagine that!

Rich in the bay area is somewhere in the neighborhood of $500k-$1MM/year.

"in the bay area" is not relevant. Living in the bay area is not a right. If the taxes or cost of living is too high, then you can't live in the bay.

Wealth is relative. "In the bay area" is absolutely relevant. Companies in SF pay so much because the cost of living is so high. Someone with $20 is not richer than someone with $10 if it costs the first person $15 to buy lunch and it costs the second person $2 to buy the equivalent lunch.

I realize that cost of living has an impact on wealth.

But, we're talking about taxes and mostly about a couple specific provisions: SALT deduction, mortgage interest deduction, and the higher-end tax rate. Relative wealth is definitely not relevant to the SALT and mortgage interest deductions. (To review, the mortgage interest deduction subsidizes the rich and the SALT deduction forces people in low tax states to subsidize people in high tax states)

The only one left is tax brackets. You could argue that tax brackets should take into account cost of living. So, if you earn 100k in Nebraska you'd pay a higher percentage of that than a similar person living in SF. But, I think that doesn't take into account the fact that SF is such an in-demand place to live. You don't have to live in SF. Basically, I'm not convinced that cost of living differences should play a role in taxes.

Honestly the upper middle class should do pretty well, if you're not currently earning income through a pass-through s-corp I'd suggest looking into setting one up.

We dev folks will be fine, it's the classic american middle-management folk who will be put through the ringer with this bill.

It's actually a hit on economic growth, since it discourages local tax-funded programs that produce a net gain in output (even after considering their costs); it literally creates a structural incentive for reduced economic growth through suboptimal local and state decision-making.

It's a product of of irrational anti-tax dogmatism.

> People have been clamoring for more taxes on the rich.

But this “tax reform”, in net, does exactly the opposite.

Yet this particular reform _does_ tax the rich more. It's mostly those making >$200k that will be hit, and it removes what were basically subsidies for the richest states in the country.

... And then it removes the alternative minimum tax, starts to phase out the estate tax and lowers pass through income tax rates. This tax cut might hit some really stupid rich people hard, but anyone wise enough to hire an accountant is going to get a lot more take home.

Looking at the new tax law as a whole, you are right, but the focus of this article is on changes to the state and local tax deduction, which currently favors rich states with high taxes.

People in expensive states are not somehow better off, dollar amounts are just higher in both the labor and real estate markets. It’s better understood as localized inflation than localized wealth.

If you mean by rich, Bill Gates and Warren Buffet level rich, then there are only a few dozen people whom you can tax that way.

Also tax is on income, not wealth. Unless Bill Gates sells his stocks, its pretty much untouchable.

There are wealth taxes. (property tax is one of them, estate tax is another -- phased out by this bill) In my opinion, we could do with a lot more wealth taxes.

But... this tax bill dramatically _lowers_ taxes on people who make a lot more money or have a lot more assets. So sure, this guy is rich relative to an unemployed coal miner. But you're being a little disingenuous by implying that this guy is remotely close to "the rich" who people commonly think of raising taxes on, and doubly so in implying that people who want higher taxes want them for everyone but themselves. I would gladly pay more in exchange for better services and safety nets.

You are being disingenuous. He's not just rich compared to an unemployed coal miner, or an employed one for that matter. He is rich compared to the vast majority of the US, and and even more vast majority of the world. Based in the GP, he's likely in the 3rd percentile for income in the US, and the .1 percentile for the world. This is essentially a minor noble complaining that the major nobles have nicer things than he does, and that the king should redistribute it (but not too much, we can't have the peasants wasting any of our precious resources)

>>Based in the GP, he's likely in the 3rd percentile for income in the US, and the .1 percentile for the world.

Most people don't understand this. When they are talking about 'the rich' or 'the 1%', they are really talking about your every day doctors, managers in most software companies, lawyers etc.

Its very hard to notice how poor and how many poor there are in the remainder of the world.

> People have been clamoring for more taxes on the rich. Well, this is what it looks like.

How exactly is this a tax increase on the rich?

People making more than $200,000 per year will pay more taxes. How is it not a tax increase on the rich?

The "rich" don't earn a salary.

> People making more than $200,000 per year will pay more taxes. How is it not a tax increase on the rich?

I'm not sure of that, though, because that only seems true if you're filing single. MFJ at the same income level puts you in a lower bracket than today. I know there are more single filers than married, and that married filers pay close to 3/4 of all income taxes, but I'm unsure if that results in an overall increase.

Besides, this whole tax plan seems to lighten the tax burden on wealth. The estate tax exemption gets larger (and eventually eliminated in the house plan), and the small business tax rate drops to 25% (S-Corps, LLC, Partnerships, Sole Proprietors) - that's almost entirely going to benefit entities used to manage passive income/wealth like PE, hedge funds, etc. The house plan is a little better here since it reduces taxes on small businesses who don't make enough to benefit from the senate version.

Put another way, if this were really a tax increase on the rich, why are we projecting that the deficit (and national debt) will increase as a result? With income distribution the way it is right now, the only way you arrive at the deficit number is to tax the rich less, not more. The issue here is that everyone is getting a tax cut, and that seems unwise to me without some adjustment to spending.

I'm fine with paying tax if we get something good like universal healthcare out of it.

I don't want to pay more tax and cut medicare just to subsidize corporations and billionaires.

The median home value in Alameda County is $796,600. Median income is $97,000, total comp for software engineers at your company ranges between 100 and 255K/year, so you are already above the median income in that county.

According to: https://www.investopedia.com/news/how-much-income-puts-you-t... "The top 5% of households earn an annual income of $214,462 or higher"

Most folks in the US, or the world would consider you rich and deserving of paying more taxes.

For comparison, "the U.S. Census Bureau reported in September 2017 that real median household income was $59,039 in 2016".

Thank you for posting the numbers to back this up.

The counter argument is, why should the rest of the country and generally lower income tax payers be subsidizing the high State taxes, high property taxes, and higher mortgage deductions on your expensive homes?

If you want to lower your State tax bill then lobby your State representatives. If you want to lower your property taxes then lobby your local officials. Or vote with your feet and move somewhere that doesn’t subscribe to those high tax policies.

California already pays more to the federal government than it takes out. It is subsidizing poorer states, not the other way around.

> The counter argument is, why should the rest of the country and generally lower income tax payers be subsidizing the high State taxes, high property taxes, and higher mortgage deductions on your expensive homes?

They aren't. The high tax states generally are net contributors to the federal treasury, the low tax states are generally net drains.

>The counter argument is, why should the rest of the country and generally lower income tax payers be subsidizing the high State taxes, high property taxes, and higher mortgage deductions on your expensive homes?

No one asks this question, because the premise is completely flawed.

http://www.businessinsider.com/the-states-the-most-and-least...

High tax states tend to pay in more than they see back in benefits.

Rich people or corporations that live in high tax states pay that money, and everybody else that lives there doesn't deserve any credit for who their neighbors are.

Lifelong Californian here. Recently moved to Florida.

You should consider complaining to your local and state government about your high taxes. Why should workers in other states subsidize local taxes for higher cost of living areas through federal deductions? Force your politicians to justify what you are paying.

"Why should workers in other states subsidize local taxes for higher cost of living areas through federal deducations"

Because those workers do not in fact subsidize my local taxes. As a Californian, I subsidize those low tax states as CA residents pay more in federal taxes than the state gets in federal benefits.

#1 in gross collections, but per capita is a different story.

https://en.wikipedia.org/wiki/Federal_tax_revenue_by_state

I don't see revenue vs outlays in that link.

You can say that about any deduction. Why should taxpayers who aren't Christian subsidize donations to churches?

I agree that a church should not be broadly exempt from taxation as the current system allows. Perhaps it could be narrowed to only exempt the value of actual goods and services provided to the community (like operating a homeless shelter or soup kitchen)

Why should donations that pay for churches to operate homeless shelters be tax deductible, while taxes that pay for state/city governments to operate homeless shelters aren't tax deductible?

This bill is just a GOP assault on states' rights.

Why should you get to make all those deductions in the first place? Just because you bought an expensive house doesn't mean you should pay that much less tax than a renter living in the same county as you.

The House version of the tax bill keeps property taxes deductible, because Texas has high property taxes and votes GOP.

Deduction used by GOP voters? Keep! Deduction used by Democrat voters? Remove!

This bill is a weaponization of the tax code against majority Democrat voting states.

I'm approaching from the opposite situation - I have a paid off house in my lower cost of living state and am relocating to the Bay Area for a job next month. I will not be selling my current home, nor buying in the Bay Area, until the fallout of this tax bill is known. At the very least, housing prices may come down where I'm going, but likely not where I'm moving from (since the mortgage interest deduction on most homes around here will wash out with the doubling of the standard deduction, but even if it does, it's percentages of far smaller numbers comparatively). Meanwhile, it sounds like nothing's changing in what I'll be able to deduct as a landlord. At least, that's my thought.

That said, it's always been a little odd to me that we could deduct our mortgage interest and property taxes, but a renter cannot even though they're paying a good portion of that on our behalf.

"That said, it's always been a little odd to me that we could deduct our mortgage interest and property taxes, but a renter cannot even though they're paying a good portion of that on our behalf."

I'm not going to suggest that it is as simple as the following, but the underlying rationale is that the renter benefits from lower rent than it would otherwise be because the landlord has lower expenses.

Landlords don’t charge their own expenses + some fixed margin. They charge what the market will bear. Expensive blue state housing markets are at no risk of seeing rents fall below landlords’ costs.

The government was subsidizing your lifestyle -- owning an expensive house in a state with a high income tax. It does not want to do this anymore. It makes as much economic sense as other subsidies do. Props for figuring out that taxation is theft though. Maybe next time don't vote for state government with highest state income tax in US?

Government subsidizes a ton of lifestyles. People with children. People who go to church. People with "pass throughs". People with estates. People with businesses. But somehow income tax in blue state is the target.

Instead of selling, if you move out and rent out your house, the rent you collect will only be taxed at a max rate of 25%. The federal income tax rate on passive income from S-corporations (which are pass through entities) maxes out at 25%.

Who are the ultra-rich getting a tax cut?

I'm under the impression that it's the corporations getting the biggest big tax cut in this bill -- so possibly your employer.

The CBO projects that those with income of greater than 1M a year get a tax cut.

If a housing-crash is an unintended consequence of this bill, I'd count it a win.

However, it's quite possible you won't have a crash but simply a consolidation as homeowners who can't afford the taxes are replaced by ultra-rich landlord-speculators.

And of course, this makes sense to the ultra-rich.

Disclaimer: This bill adversely affects me as well, and I'm not in favor of it, but:

>This tax bill utterly fucks me, to the point I'm considering selling my house to get ahead of the inevitable housing crash.

Can you imagine any type of reasonable tax reform that would not cause someone's tax to go up? Just the fact that some folks' taxes will go up does not make it a poor plan.

If your deductions are about $60K, then whether you feel like it or not, you are rich. And most tax overhauls would likely tax wealthier people more. This bill is a bit problematic as it taxes people in the upper middle class the most - whereas the rest of the lower/middle class and upper class get a break.

This is not a reasonable tax reform - its a net negative 1.5 trillion dollars to the federal budget, but really it's giving even more than that to corporations and the rich while increasing taxes on people who primarily make their income from labor (vs capital rents).

Bingo!

"If your deductions are about $60K, then whether you feel like it or not, you are rich."

You are confusing income with wealth. They are somewhat causally related to be sure, but totally different. Case in point: I started receiving a high income at the age of 40 in SF, where before I earned a poverty wage. At 42, I have much less wealth than your average SF school teacher of the same age.

Define "highish". You'll only get a tax increase if you're making more than 350K.

https://jsfiddle.net/381rkrsq/

I'm not ultra rich, and these tax changes benefit me. From what I understand, the tax changes do benefit a high number of people. But the amount they appear to negatively impact those that don't benefit from them, also appears to be high (which of course, isn't great)

I have not looked in depth at the tax changes (ie read the changes in detail), but I do think there's more to the changes than just giving the ultra rich a tax cut.

It seems to me that those living in high tax states, with expensive housing, appear to be negatively impacted.

> I cannot see this bill as anything short of theft. Why do I have to pay double-digit percentage more on my taxes to give the ultra rich a tax cut? In what fucking world does that make any economic sense.

My rent isn't tax deductible. Why is yours blessed with such a status (In the form of a mortgage, and property tax deduction)?

All that mortgage tax deductions do, economically, is increase the overall price of homes, and have non-homeowners subsidize home-owners.

Because the person that owns the property you rent is receiving those benefits.

Mortgage interest and property taxes are costs on top of the actual cost of the house. My mortgage itself isn't tax deductible.

It's still a concession to homeowners that renters don't get.

We want taxes to be fair, no?

Not really. Trying to make taxes fit some arbitrary definition of fair is most of the problem. We should be looking at macro effects on our whole economy when making decisions on taxes.

FWIW, only the interest is deductible, not the entire payment.

I agree with the sentiment though. The realtors have arguably the most effective lobbying efforts, and to be able to tie their industry in with the "American Dream" has been very effective.

I was out in DC earlier this year speaking with my congressional representatives about some changes to the bankruptcy code. We were working with a lobbyist who said something along the lines of "everybody knows when the realtors are in town. Nobody tries to get meetings that week because they have such a great mobilization effort, everyone gets booked up."

The rationale is to encourage home ownership, because that gives people an incentive to care about upkeep and the community. It's hard to create good neighborhoods with renters who can just pack up and leave.

Relax. You’re not subsidizing anyone. Homeowners pay a larger share than renters to begin with. And if you know anything about Western society, home ownership creates stable societies—that’s why ownership is encouraged.

>Relax. You’re not subsidizing anyone. Homeowners pay a larger share than renters to begin with.

As someone who knows many landlords: Completely wrong.

They buy properties with a loan. They pay interest on that loan. The money the renter pays goes towards the interest payments. Renters are essentially buying the properties for the owners.

And landlords can keep deducting it, no matter how many properties. Homeowners can deduct only for two houses. And renters deduct none of it. The landlords literally deduct what their tenants are paying (interest, which is part of their rent).

And not sure about your other comment, but rarely do renters of similar size houses/apartments pay less than homeowners. As an example, my house I bought only a few years ago: I pay just a little more than some 3 bedroom apartments (which are much smaller than my house). Most 3 bedroom apartments in desirable areas in my city pay more in rent than my monthly payment.

And then with all the deductions I was getting, I was effectively paying less than most 2 bedroom apartments, and some single bedroom apartments. And if I take into account the amount going towards the principle, I'm paying about the same as most single bedroom apartments in my area.

I did not put in a huge down payment. Less than 20%, in fact.

Uhhh, the topic was about taxes. The homeowner demographic is statistically a higher earner than the renter demographic, thus pay more taxes.

Businesses generally get to deduct interest on loans used for the business, so landlords would probably be able to deduct mortgage interest under that even if there was no specific mortgage deduction in the tax code.

Accordingly, I'm not sure it makes sense to discuss landlords when discussing the mortgage interest deduction.

As a point of comparison, Massachusetts does not have a mortgage interest deduction for individual homeowners, but for landlords income is computed using the federal Schedule E with only a few state-specific adjustments, so mortgage interest is still deductible. Of course landlords also pay tax on their rental income (minus expenses of course), while individual homeowners don't have to pay any tax on imputed rent.

Ok, lets play this game. From now on its renters that have to pay 50% of the property tax. No? But you get to deduct it! an extra deduction for you! whats not to like?!

> Ok, lets play this game. From now on its renters that have to pay 50% of the property tax. No? But you get to deduct it! an extra deduction for you! whats not to like?!

Renters already are paying a piece of the property tax. It's built into the rent. They just can't deduct it.

Ok that may be true but why should they be allowed to deduct it? They are not a business owner (unlike the landlord). Its like allowing people to deduct 10% of everything they buy from Amazon because they are paying a part of Amazon’s warehousing costs.

I'm not advocating for renters to be able to deduct a piece of the underlying property tax. I don't think it makes sense to have property tax as a federal deduction at all.

In general, I'm not sure how great it is that we favor home ownership over renting in our tax policy. My bigger issue is being able to deduct mortgage interest but not rent. Mortgage interest is essentially rent on money, so I've always thought it'd be fair to make rent (or a percentage of it at least) deductible as well. Or, even better, eliminate the mortgage interest deduction entirely.

Full disclosure, I'm a homeowner. Fuller disclosure, my home is paid off, so it's easy for me to say these deductions shouldn't exist. I would gladly give up the property tax deduction if that additional revenue was used for something other than cutting taxes for the wealthy, though.

OK, I see your point with mortgage interest interested being deductible.

Renters are already paying all of the property tax. The expenses for any business (including being a landlord) are, in the long term, paid by the customers. Otherwise the business becomes insolvent.

I concede renters may be paying a part of it.

However if a landlord is like a business owner, and property tax is a business expense, why should they not be allowed to deduct it (just like any other business expense)?

Amazon has expenses too related to storing products in warehouses, which they can deduct. Part of that cost is priced into the product. So in theory, customers should be able to deduct a portion of every product they buy from Amazon?

Just my opinion, but society benefits from having manageable costs of living. I acknowledge that landlords have a business to run, but we also have a policy favoring ownership. Not allowing a property tax or non-occupied mortgage interest deduction raises the costs of being a landlord, disfavoring that activity a bit from a policy perspective. That, in turn, may lower housing costs (and increase owner-occupation of primary residences) by taking some landlords out of that market.

We built a broad middle class by favoring home ownership, allowing regular folks to build wealth in the form of their primary residence. I think we need to get back to that, and that does mean making policy decisions that eats into the margins of landlords.

> allowing regular folks to build wealth in the form of their primary residence

Sometimes that's true, sometimes it isn't. Sometimes people wind up with underwater mortgages, rather than building wealth.

I don't think other business expenses should be deductible either, as that incentivizes inefficient businesses.

I would favor eliminating all business deductions, combined with lowering the tax rate enough to make the change revenue neutral.

it is not theft to remove a deduction. state and city taxes should never have been deductible before this. That deduction favored those who could itemize, the well off.

People harp all the time on this site about the plight of the poor, the undeserved, and more but damn you guys don't suck. You are damn generous when it comes to some other person's money but have you pay more and it is Armageddon. Quit bemoaning the wealthy and recognize you are one of them. It doesn't take millions to be wealthy in this country and certainly not billions.

As with the city/state tax issue, all deductible taxes favor the wealthy. This takes an otherwise overly progressive tax system to steals it back by slight of hand. Politicians can show the poor who the exploit "see these high rates" and then bury a myriad of breaks in the system to give back to those who provided the funds needed for election.

Hell i am going to get walloped and I will adjust. I qualify for the 7500 EV rebate for my purchase in 17 and I am glad it is going; though for two reasons the first being the rich don't need help buying cars and the second manufactures late to the game should not get the benefit born out by the early adoption manufacturers.

The Joint Committee on Taxation finds no reason to not favor the bill. Deficits we experience don't come because of tax cuts, it comes because baseline budgeting out paces inflation and GDP growth.

Guess what guys, its time we pony up and pay for what we want. We don't get to pontificate on forums all day long. We have to pay the piper just like everyone else and many of us will benefit from the cut as well as suffer some losses but in the end those on the lower brackets will see nearly all their tax burden decreased and isn't that what we all keep saying we want, to help them up?

"but in the end those on the lower brackets will see nearly all their tax burden decreased and isn't that what we all keep saying we want, to help them up"

Go read the CBO report. This is blatantly false. If you believe this and are not a troll, please educate yourself.

I went to an open house in SF Saturday. The realtor had been planning to list the house in February but the seller is so worried about the tax situation they put it on the market and want it sold ASAP.

Any chance you'd be willing to, roughly, show your work? I'm curious to see if your calcs are accurate and how you are getting to that number. Understand if you prefer not to. Thanks.

The upper middle class is apparently a minority that is politically safe to do economic harm to.

Bingo. Working and middle class say, “fuck you, you’re rich.” Upper class says, “fuck you, only peasants get paid in wages/salary.”

Same with housing. The rich see single family homes as a good investment at any price. The poor see anything other than BMR as not for them. No one wants to house yuppies other than a constituency which is too privileged to have liberal credibility and too poor to leverage policies driven by the rich.

When the federal government gives high tax states tax cuts, that means those areas give less to the federal government, meaning those generally rich states end up getting federally subsidized by the poorer states.

How does _that_ make sense? Shouldn't the richer areas help pay for the poor? Why not do something about the high taxes in your state instead?

> When the federal government gives high tax states tax cuts, that means those areas give less to the federal government, meaning those generally rich states end up getting federally subsidized by the poorer states.

Except those generally rich states are, in fact, currently net federal tax subsidizers of the rest of the country; this tax reform will actually reduce that because the rich people who are concentrated on those states will get huge tax cuts, whereas poorer people in the rest of the country will get big tax increases.

> Shouldn't the richer areas help pay for the poor?

So, what you are saying is we shouldn't adopt a tax “reform” that massively reduces progressivity transferring tax burden from the rich too the poor?

If so, on that much we agree.

We do subsidize poor states. You speak as though Red states contribute anything to the federal government. With the exception of Texas, Georgia and some oil rich states, all of the Red states are takers and just about all of the Blue states are givers.

Red states also tend to have a lot more poverty and less economic development. Why should rich areas of the country receive just as much federal aid as poor areas? It makes sense that different states receive different aid.

They don't. For every dollar we send the Federal government, we (California) gets back 88 cents. Mississippi gets something like $4 for every $1 it sends to the Federal government.

So you lost your special interest deductions and now have to pay taxes on your actual income? Doesn't sound unfair to me.

It doesn't, and that's why a large majority of economists were wholly against it.

>>I cannot see this bill as anything short of theft

Welcome to libertarianism ;)

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