As the US rang in the New Year, we also brought in a variety of new laws and tax changes. What will they mean for you?
With a few exceptions most individuals can expect to pay more taxes in 2016. This is definitely true for NY property owners. There may be some tax rebate checks in the mail for some Long Island homeowners, some states may even reduce their income taxes. But what the math really comes down to for most individuals is how great they do at maximizing the tax breaks available to them.
Your Income & Debt in 2016
Most New Yorkers are preparing to buckle down to work at least until May 2016, just to pay their tax debt. On January 1st, 2016 the New York State Department of Taxation and Finance announced new withholding tax changes for workers and their employers. Some could see a larger chunk coming out of their paychecks before they even get to touch it. This downward pressure on income could get worse with many analysts predicting a new recession in 2016. Fortunately NYC workers can now take advantage of using pre-tax income to cover the cost of commuting into the city. Meanwhile maxing out IRA contributions before the April income tax filing deadline could help some cut their tax debt by $5,500, and up to $11,000 for couples.
NY Property Taxes in 2016
New York property taxes are headed up again in 2016. But there are a number of breaks available. Long Island homeowners have the potential ability to deduct the mortgage interest they pay each year, and closing costs when purchasing new homes. Sellers can look to capital gains tax exemptions providing they have lived in their property for 2 of the last 5 years. Those that are trading up investment properties before interest rates go higher should weigh 1031 exchanges as an option for deferring taxes.
Every Long Island property owner ought to consult a local property tax adjuster to see if they are eligible to appeal their annual property tax bills, and get them reduced.