06 Jan Telluride Real Estate News: Happy New Year + 2018 Tax Code
In his regular column, (narratives and video), Telluride Real Estate News, Robert Stenhammer leverages his extensive knowledge of market factors (global, national, and regional) and the Telluride lifestyle to bring readers fresh, informative – and insider – real estate news to use today.
Robert Stenhammer
“Happy New Year and welcome to 2018! Telluride has really shown its best side in recent weeks. With challenging early season snowfall conditions, the Resort and the Telluride community are going above and beyond to make sure our Owners and Guests are enjoying this special place with family and friends.
We have found out it’s not all about the skiing (who knew?), but rather sincere hospitality, welcoming, entertainment and memorable experiences. Thank you to Telluride Ski Resort’s Mountain Operations and Snowmaking for providing a great product. The snow will come soon.
Check out the amazing time lapse video (below) of our Mountain crews working in the shadows of our alpine stars and meteors. The video was shot on 12/15/17 from 5- 7 a.m.”
And now on to challenge greater than snow (or no, for now anyway): the 2018 Tax Code and its impact on residential and commercial real estate.
Major Provisions Affecting Current and Prospective Homeowners:
Tax Rate Reductions
• The new law provides generally lower tax rates for all individual tax filers. While this does not mean that every American will pay lower taxes under these changes, many will. The total size of the tax cut from the rate reductions equals more than $1.2 trillion over ten years.
• The tax rate schedule retains seven brackets with slightly lower marginal rates of 10%, 12%, 22%, 24%, 32%, 35%, and 37%.
• The final bill retains the current-law maximum rates on net capital gains (generally, 15% maximum rate but 20% for those in the highest tax bracket; 25% rate on “recapture” of depreciation from real property).
Exclusion of Gain on Sale of a Principal Residence
• The final bill retains current law.
Mortgage Interest Deduction
• The final bill reduces the limit on deductible mortgage debt to $750,000 for new loans taken out after 12/14/17. Current loans of up to $1 million are grandfathered and are not subject to the new $750,000 cap. Neither limit is indexed for inflation.
• Homeowners may refinance mortgage debts existing on 12/14/17 up to $1 million and still deduct the interest, so long as the new loan does not exceed the amount of the mortgage being refinanced.
• The final bill repeals the deduction for interest paid on home equity debt through 12/31/25. Interest is still deductible on home equity loans (or second mortgages) if the proceeds are used to substantially improve the residence.
Interest remains deductible on second homes, but subject to the $1 million / $750,000 limits.
Deduction for State and Local Taxes
• The final bill allows an itemized deduction of up to $10,000 for the total of state and local property taxes and income or sales taxes. This $10,000 limit applies for both single and married filers and is not indexed for inflation.
•The final bill also specifically precludes the deduction of 2018 state and local income taxes prepaid in 2017.
Standard Deduction
• The final bill provides a standard deduction of $12,000 for single individuals and $24,000 for joint returns. The new standard deduction is indexed for inflation.
• By doubling the standard deduction, Congress has greatly reduced the value of the mortgage interest and property tax deductions as tax incentives for homeownership. Congressional estimates indicate that only 5-8% of filers will now be eligible to claim these deductions by itemizing, meaning there will be no tax differential between renting and owning for more than 90% of taxpayers.
Repeal of Personal Exemptions
• Under the prior law, tax filers could deduct $4,150 in 2018 for the filer and his or her spouse, if any, and for each dependent. These exemptions have been repealed in the new law.
• This change alone greatly mitigates (and in some cases entirely eliminates) the positive aspects of the higher standard deduction.
Mortgage Credit Certificates (MCCs)
• The final bill retains current law.
Deduction for Medical Expenses
• The final bill retains the deduction for medical expenses (including decreasing the 10% floor to 7.5% floor for 2018).
Deduction for Casualty Losses
• The final bill provides a deduction only if a loss is attributable to a presidentially-declared disaster.
• The House bill would have eliminated the deduction for casualty losses with limited exceptions.
Moving Expenses
• The final bill repeals moving expense deduction and exclusion, except for members of the Armed Forces.
Major Provisions Affecting Commercial Real Estate…
More about Robert Stenhammer:
Daughters Sammy (18), Mackenna (16), Robert and Wife Heidi.
Born and raised in Minnesota, Robert Stenhammer holds a BA in business and an MBA in hospitality and tourism. He has enjoyed a 20+-year career in luxury resort management and been a licensed real estate broker since 2009. Specifically, his expertise encompasses real estate, hotels, vacation rentals, resort management, community relations, government affairs, and destination marketing.
Robert began his resort management career in the ski resorts of Colorado, where he directly oversaw the management of over 2,600 vacation rental properties, 40 homeowner associations, retail, food and beverage, real estate, hotels, and resort operations during his stints with Vail Resorts and Intrawest.
Robert went on to work on Hilton Head Island, South Carolina, for seven years, serving on the Board of Directors for the Hilton Head Island/Bluffton Chamber of Commerce & VCB. He chaired the Accommodation Tax Committee for the Town of Hilton Head Island, got his brokerage license, and was a regular hospitality, tourism, and real estate columnist for the Island Packet newspaper and Hilton Head Monthly magazine.
In his former duties as executive vice-president for Telluride Ski & Golf Resort, Robert Stenhammer was responsible for hotel and vacation rental resort lodging, Mountain Village retail operations, golf course operations, the Telluride Conference Center, Telluride Concierge Luxury Transport, and the exclusive Telluride Ski and Golf private members club.
Telluride Real Estate News twins with Robert Stenhammer, now an associate broker with Telluride Real Estate Corp./Christie’s International Real Estate. His TellurideRealEstates.com offers a fresh, fun, informative way to search for properties in the Telluride region: mobile search awesomeness, lifestyle search, luxury search, new listing, and hot deals.
Daughter Sammy (18), Robert, Daughter Mackenna (16) and wife Heidi.
In his new job for Telski, Office of the CEO (Bill Jensen), Robert is charged with helping to make Telluride the #1 resort in the world by working in government affairs and on strategic partnerships and new initiatives for the resort, including housing, access, and sustainable development for a better (read “greener’) future.
As a broker, Robert understands how to leverage his intimate knowledge of the market and executive-level communication skills and service experience to exceed his clients’ real estate objectives.
Off-hours, Robert takes advantage of the active Telluride lifestyle His home is in Mountain Village, where he lives with his wife Heidi and daughters Samantha (18) and Mackenna (16).
Again, feel free to contact Robert Stenhammer if you want additional information about the Telluride Ski & Golf Club and/or if you are interested in buying property in the Telluride region. To stay informed about the Telluride lifestyle and real estate opportunities, go here, like his Facebook page, Telluride Real Estate News, or call 970-708-7771.
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