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Ali's Monthly Tip- November

November 20, 2018

Taxes- everyone's favorite subject! The first installment is due on December 10th and there is a whopping (approximate)10% penalty, so don't be late! California state property taxes are 1% of your purchase price, but also included are any location specific bonds, etc.  To be conservative, you can budget spending 1.1% annually on property taxes. They are also broken up into two installments, with the first installment being Due on Dec, 10th. 

 

The tax code has drastically changed starting with the 2018 tax year.  Previously, the entire amount of your property taxes were deductible.  However, that has changed and will greatly impact SB and California since we have a high median sales price.  Under the new tax code, deductions are capped at $10,000 for all state and local property, sales and income taxes.  So if you bought a million dollar home, your property taxes (for simplicity's sake) would be roughly $10,000 for the year.  Let's say you also owe $8,000 in state taxes, welp.... the not awesome news is you can ONLY deduct $10,000, not the full $18,000 that you could have done previously.  

 

2018 is the first year of these new codes, so be extra nice to your accountants as they have tons of new rules to wade through. In the new tax year, it will be interesting to see how this change paired with other new rules will shake out.  

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ALI EVANS |   Realtor & Broker Associate

Berkshire Hathaway HomeServices, 3868 State St., Santa Barbara, CA 93105

805.980.8007   www.alievansrealty.com  DRE# 01846603   ali@alievansrealty.com

Office DRE# 01317731

©2019 Berkshire Hathaway HomeServices California Properties (BHHSCP) is a member of the franchise system of BHH A liates LLC. BHH A liates LLC and BHHSCP do not guarantee accuracy of all data including measurements, conditions, and features of property. Information is obtained from various sources and will not be veri ed by broker or MLS. Buyer is advised to independently verify the accuracy of that information.