fiscal cliffOn January 1, 2013 both the Senate and House passed H.R. 8 legislation to avert the “fiscal cliff.” The bill will be signed shortly by President Barack Obama.

Below is a summary of real estate related provisions in the bill as summarized by the National Association of Realtors:

Real Estate Tax Extenders

  • Mortgage Cancellation Relief is extended for one year to Jan. 1, 2014
  • Deduction for Mortgage Insurance Premiums for filers making below $110,000 is extended through 2013 and made retroactive to cover 2012
  • 15-year straight-line cost recovery for qualified leasehold improvements on commercial properties is extended through 2013 and made retroactive to cover 2012
  • 10 percent tax credit (up to $500) for homeowners for energy improvements to existing homes is extended through 2013 and made retroactive to cover 2012

Permanent Repeal of Pease Limitations for 99% of Taxpayers

Under the agreement so called “Pease Limitations” that reduce the value of itemized deductions are permanently repealed for most taxpayers but will be reinstituted for high income filers. These limitations will only apply to individuals earning more than $250,000 and joint filers earning above $300,000. These thresholds have been increased and are indexed for inflation and will rise over time. Under the formula, the amount of adjusted gross income above the threshold is multiplied by three percent. That amount is then used to reduce the total value of the filer’s itemized deductions. The total amount of reduction cannot exceed 80 percent of the filer’s itemized deductions.

These limits were first enacted in 1990 (named for the Ohio Congressman Don Pease who came up with the idea) and continued throughout the Clinton years. They were gradually phased out as a result of the 2001 tax cuts and were completely eliminated in 2010-2012. Had we gone over the fiscal cliff, Pease limitations would have been reinstituted on all filers starting at $174,450 of adjusted gross income.

Capital Gains

Capital Gains rate stays at 15 percent for those in the top rate of $400,000 (individual) and $450,000 (joint) return. After that, any gains above those amounts will be taxed at 20 percent. The $250,000/500,000 exclusion for sale of principle residence remains in place.

Estate Tax

The first $5 million dollars in individual estates and $10 million for family estates are now exempted from the estate tax. After that the rate will be 40 percent, up from 35 percent. The exemption amounts are indexed for inflation.

Search all Tampa FL homes for sale.

When buying or selling property in today's real estate market, it's important to have confidence in your Tampa FL real estate professional!  In order to be the best, I have earned the CRS (Certified Residential Specialist) and ABR (Accredited Buyer's Representative) designations.  I have also been awarded a National Award of Excellency by Realtor.com.  This demonstrates my desire to stay on the cutting edge of the Tampa Bay real estate market. My commitment as your Tampa area REALTOR® is to provide you with the customized real estate service you need!

I AM A SHORT SALE & FORECLOSURE SPECIALIST

As an informed buyer or seller, you'll make the best decisions for the most important purchase or sale in your lifetime! That's why my goal is to KEEP YOU INFORMED on trends in the Tampa FL real estate market using the latest sales statistics in Tampa.  With prices and interest rates at historic lows, now is the right time to buy real estate in the Tampa market!

Let me know what you need and I will email you a list of properties INCLUDING BANK-OWNED, SHORT SALE & HUD PROPERTIES that suits your location and fits your budget. Please call, 813,728-3880, or email me at any time.