Anonymous
Post 02/20/2019 13:12     Subject: MD Taxes and SALT
Anonymous wrote:
Anonymous wrote:
Anonymous wrote:Keep in mind that in 2017 the standard deduction for MFJ was $12K vs 2018 at $24K. So you aren't really losing "$10k" in SALT

Why do people keep forgetting that we also lost the personal exemptions?


True but most people come out ahead with the $2K child credit (a credit and not a deduction which is more powerful at lower incomes).

But *most* people who used to use the itemized deduction due to high SALT have higher taxes even with the child tax credit, which if you are a dink, you don't get. But you would've gotten the personal exemption.
Anonymous
Post 02/20/2019 13:12     Subject: Re:MD Taxes and SALT
Anonymous wrote:I did our taxes last weekend. We lost something like 20K in deductions, though we still itemized (just barely). We did owe the Feds (about 1500), but we paid the same percentage of our income in federal taxes from last year to this year. This year, we're updating our withholdings so hopefully we won't owe next year. So we weren't actually screwed tax wise. That said, where we're actually going to be screwed is with the downstream uses of our AGI, which is now significantly higher than it had been before. Our income-based student loan repayments will be based on the much higher AGI the next time we re-certify, so I expect our student loan payments to increase significantly. We're also sooooo much closer to the hitting the income limits for contributing to a Roth IRA. We are both getting relatively small raises this year, but they may be enough for us to hit the cap next year, so we'll have to figure out alternatives. I don't know that there's anything MD can do to help with these downstream consequences....


You don't really know what you are talking about or must be one of those Never Trumpers.

AGI has always been prior to any itemized deductions relating to SALT or mortgage interest. Whether you itemize or take standard deduction as no impact on your AGI. Yes...your income has gone up ...instead of lamenting about what it might do in the future enjoy and be thankful for it.
Anonymous
Post 02/20/2019 13:07     Subject: MD Taxes and SALT
Anonymous wrote:
Anonymous wrote:Keep in mind that in 2017 the standard deduction for MFJ was $12K vs 2018 at $24K. So you aren't really losing "$10k" in SALT

Why do people keep forgetting that we also lost the personal exemptions?


True but most people come out ahead with the $2K child credit (a credit and not a deduction which is more powerful at lower incomes).
Anonymous
Post 02/20/2019 13:06     Subject: MD Taxes and SALT
Anonymous wrote:
Anonymous wrote:Has anyone found that other changes have balanced out the SALT hit? For instance, we now qualify for the $2,000 child credit and our rate has gone down from 28% to 24%. But I'm feeling really dumb about weighing all the factors.

I'm also regretting not changing our withholding this summer like so many of you smart people advised. Gah!


We came out ahead despite the SALT change.

It depends on your individual circumstances. Our SALT was previously limited by AMT. However, a combination of lower rate, AMT repeal and surprise child credit made our tax rate lower than last year.



Also the marriage penalty for married filing jointly has been eliminated for all brackets except the top one. This helped us a lot.
Anonymous
Post 02/20/2019 12:49     Subject: MD Taxes and SALT
Anonymous wrote:Keep in mind that in 2017 the standard deduction for MFJ was $12K vs 2018 at $24K. So you aren't really losing "$10k" in SALT

Why do people keep forgetting that we also lost the personal exemptions?
Anonymous
Post 02/20/2019 12:48     Subject: Re:MD Taxes and SALT
I did our taxes last weekend. We lost something like 20K in deductions, though we still itemized (just barely). We did owe the Feds (about 1500), but we paid the same percentage of our income in federal taxes from last year to this year. This year, we're updating our withholdings so hopefully we won't owe next year. So we weren't actually screwed tax wise. That said, where we're actually going to be screwed is with the downstream uses of our AGI, which is now significantly higher than it had been before. Our income-based student loan repayments will be based on the much higher AGI the next time we re-certify, so I expect our student loan payments to increase significantly. We're also sooooo much closer to the hitting the income limits for contributing to a Roth IRA. We are both getting relatively small raises this year, but they may be enough for us to hit the cap next year, so we'll have to figure out alternatives. I don't know that there's anything MD can do to help with these downstream consequences....
Anonymous
Post 02/20/2019 12:40     Subject: MD Taxes and SALT
Anonymous wrote:Keep in mind that in 2017 the standard deduction for MFJ was $12K vs 2018 at $24K. So you aren't really losing "$10k" in SALT


True, but they also eliminated the personal exemptions when they raised the standard deduction, so for a family of four, that's +$12K for the standard deduction and -$16K for the personal exemptions, plus a $4K child tax credit that helps offset it, along with the lower rates. So people losing $10K+ in SALT deductions really are still losing quite a lot.
Anonymous
Post 02/20/2019 12:36     Subject: MD Taxes and SALT
Anonymous wrote:Has anyone found that other changes have balanced out the SALT hit? For instance, we now qualify for the $2,000 child credit and our rate has gone down from 28% to 24%. But I'm feeling really dumb about weighing all the factors.

I'm also regretting not changing our withholding this summer like so many of you smart people advised. Gah!


We came out ahead despite the SALT change.

It depends on your individual circumstances. Our SALT was previously limited by AMT. However, a combination of lower rate, AMT repeal and surprise child credit made our tax rate lower than last year.

Anonymous
Post 02/20/2019 12:32     Subject: MD Taxes and SALT
There are no way around it. Those of us in Blue states are screwed by the new tax law. Really, almost anyone who itemized is screwed.
Anonymous
Post 02/20/2019 12:30     Subject: MD Taxes and SALT
Has anyone found that other changes have balanced out the SALT hit? For instance, we now qualify for the $2,000 child credit and our rate has gone down from 28% to 24%. But I'm feeling really dumb about weighing all the factors.

I'm also regretting not changing our withholding this summer like so many of you smart people advised. Gah!
Anonymous
Post 02/20/2019 12:25     Subject: MD Taxes and SALT
Anonymous wrote:Keep in mind that in 2017 the standard deduction for MFJ was $12K vs 2018 at $24K. So you aren't really losing "$10k" in SALT


Does that matter if we are itemizing deductions anyway? To us it feels like a loss.
Anonymous
Post 02/20/2019 12:23     Subject: MD Taxes and SALT
Keep in mind that in 2017 the standard deduction for MFJ was $12K vs 2018 at $24K. So you aren't really losing "$10k" in SALT
Anonymous
Post 02/20/2019 12:20     Subject: Re:MD Taxes and SALT
Nothing you can do except press on your elected officials to introduce new federal tax legislation.
Anonymous
Post 02/20/2019 12:18     Subject: MD Taxes and SALT
nope, you're screwed, like many others.
Anonymous
Post 02/20/2019 12:15     Subject: MD Taxes and SALT
So we are among the many hit by the $10,000 SALT deduction cap in MoCo. Our combined state, local, and property taxes were around $20,000. Does MD have any workarounds that might balance out the hit we will take on our federal taxes? I suspect we are just screwed, but want to make sure I haven't missed anything. We plan to itemize both our federal and state taxes (total deductions are around $28,000). Thanks.