We don't own a home so mortgage deduction would not impact us.
State/local taxes not being able to be deducted would be huge for us -- about 10% of our non-adjusted gross income goes to state and local taxes so that's a very big deduction for us. And it would keep us from being able to itemize our charitable deductions.
Post by barefootcontessa on Dec 6, 2012 14:58:33 GMT -5
It will totally mess up my long-range financial plans. We are looking at having to carry two mortgages next year (hopefully not for long) and it will be a major setback if they eliminate it.
All this uncertainty is terrible on so many levels.
We'd definitely feel the bite. I'd go from feeling comfortable, to feeling that finances are tight.
That said, we have to sell our place next year and we'll be renting when we move, so I guess we'll be "taking home" less money next year regardless of what happens.
Post by Velvetshady on Dec 6, 2012 15:13:25 GMT -5
It would make doing our taxes much easier--we'd no longer have a reason to itemize. And we'd go from paying a higher % than Romney to paying a *much* higher % than Romney.
eta: That said, our financial picture would still be much better than if we go flying over the fiscal cliff. The downside of both having jobs relying on the Fed Government.
A crapton. We both earn nice salaries and we have no kids. So mortgage interest deduction is huge for us as it is about $24K alone. Not to mention everything else.
We are already prepared for our income to go down $1K+ with these tax hikes which will really cut into our savings and force us to reduce our spending quite a bit as well.
We would end up with atleast $1000 change in our return. If they took away the charitable deduction that would impact us also. We have no kids so the only deductions we get are mortgage interest and charitable.
Post by njohnson1972 on Dec 6, 2012 15:41:45 GMT -5
Just based on the question, we would owe $3,600 more. Since we don't pay state taxes, we do get a sales tax deduction and I don't know if that would go away. And what about property taxes?
I am going to be so pissed if the charitable deduction gets cut. That is all.
If they cut mortgage interest + state tax deductions, I'm afraid it would effectively get cut even if it isn't expressly cut. If people who previously itemized, don't anymore because of the cuts to other deductions, charitable donations wouldn't be incentivized among a large swath of the population who can't afford to exceed the standard deduction in charitable donations alone