Okay, we are on part 5 of the 10,
the Trump vs. Harris tax battle. This one,
I'm specifically going to cover some of the things I mentioned about itemized deductions.
So remember, itemized deductions, these are the deductions on your personal taxes.
So it's, like, everyone gets a standard deduction. It's if you're a married filing
joint tax return, you get about a $30,000 free deduction.
We're talking about, not the standard, we're talking about the itemized deductions.
So specifically with, there's a SALT tax limitation.
So S-A-L-T, all in caps.
The sales and local tax deduction.
So what this is, this was back years ago,
20, what was it, 2017, 2018.
They passed a law where there was a cap on how much you can
deduct in what you pay in state income tax,
what you can pay in property tax. Tax and sales tax on the personal
side, it was capped at $10,000. So that cap on
the Trump side, they've mentioned that they want to remove the cap,
which is a huge benefit for people in high,
like in high income because there's no limit on the state tax deductions.
That they can take, there's no income on,
or there's no limit on like the property taxes for their house.
As you know, if you've owned a home since 2020,
property taxes on houses have shot way up. So I would expect a lot
of you probably hit that $10,000 limit on your itemized deductions.
So it's, it's one of those things that on the Trump side,
it would benefit, it would benefit the high income earners,
but it's also not going to hurt the middle class or low income earners.
Just removing that limit. I, I would be all for removing the limit.
It's kind of annoying if you're actually paying for your property tax and income
tax and you just don't get a deduction for it. So it,
it has a pretty big impact, especially for those people in the,
uh, like the high real estate tax areas,
New York, Texas, California, kind of the,
kind of the big, uh, property tax states.
And then, uh, on the Harrah side,
what we would expect is that that limit stays in place at the $10,000.
Like, they're, they're, we just haven't seen any proposals to remove it.
And so we would just assume it's at the same, so we don't,
we don't know for sure. But I would expect it's the same because that
is a permanent change to the tax laws. Remember,
a lot of these things, there's permanent changes or permanent things in the tax
law. A lot of the Trump tax cuts from 2017 to 2018,
a lot of those were temporary and they're phasing out,
like they're disappearing for them to get it passed. They had to phase out
by 2021. And so,
some of these things, we're just talking about them becoming a permanent part of
the tax law. Uh, so, the other one related to itemized deductions on the
personal side. So, real quick, remember itemized deductions,
these are medical expenses, uh,
property taxes, and income tax deductions, mortgage interest,
and charity. Those are really your, your only itemized deductions as an individual.
There's one more that, uh,
Trump has proposed of adding to these personal deductions,
and they're, they're, uh, interest on car loans.
So, as like a business owner, or if you're,
if you're running a business, you can deduct the interest on whatever loans you
have, if it's for the business specifically.
But individuals, like people,
W-2 employees, if you have a car loan, you get no benefit from the
interest that you're paying on that car loan.
So if you buy a house, there's an interest deduction,
but not for car loans, until potentially now,
if the Trump proposal came through,
you would be able to deduct the interest on car loans.
Um,
for high income earners, she'd come out and said that they'd,
they would be a proponent of limiting the amount of itemized deductions you can
take as a high income earner.
We don't have details on the specifics of that,
but there are, there are some other tax laws in place that are kind
of like that. Like, really high income earners, there's alternative minimum taxes,
just types of limitations, or limitations on the amount of your mortgage interest on
your home. If it's alone, more than 750,000,
there's just a limit. This is in the current law. There's a limit on
the interest you can deduct on a- loan that's more than 750,000 dollars.
So I'd expect there'd probably be more limits like that where it's not,
it wouldn't be hurting low income or even middle income people,
but it, it would, it would hurt or it would reduce the benefit that
high income earners get, uh,
from some of these d- reduction. So that, that's probably the way where that
looks like it would be the way you've, you've probably heard they've,
uh, Harris has come out multiple times and said they're not raising taxes on
people making less than 400,000.
I would expect the 400,000 and up limit is where they're going to start
removing some of these deductions to effectively raise the tax rates of people making
400,000. Okay. So that's the,
remember, this was for personal tax deductions.
These are the itemized deductions. Um,
some of the comparisons there. And,
uh, yeah, that's the end of the five of 10.
Tax battle. See ya. Thank you.
