Congressional Republicans’ plans to cap the federal deduction for property taxes at $10,000 could wallop the Boston and Cambridge housing markets in particular, according to a new analysis from Business Insider.
Currently, taxpayers can deduct all property taxes on their federal returns.
The reasoning goes that if a significant chunk of households can no longer do that because their property taxes exceed the new $10,000 cap, then that housing market could start to teeter as a major incentive for buying goes away.
In Cambridge, 10.8% of households have property tax bills that exceed $10,000. In Boston, 12.4% do.
Such figures place the cities among the 10 larger ones nationwide with the largest share of households paying more than $10,000 in property taxes.
But, as the Globe’s Tim Logan points out, thing could get even dicier in the region’s smaller, more suburban municipalities. There average property tax levies can run much higher than in Cambridge or Boston.
Keep in mind, too, that lawmakers also plan to scale back how much mortgage interest borrowers can deduct from federal taxes.
Brace yourself. Or break out the prosecco if you’re thinking of buying. Or own apartments.
- The 11 worst places to buy a home if Trump's tax plan passes [BI]
- Apartment landlords in Boston area could be big winners under federal tax changes [Curbed Boston]