Tired of taxes? Watch out for these eight real estate taxes in 2020.
Between new legislation that could implement new taxes on property owners, rising existing taxes, taking away breaks and deductions, and the implementation of recent rules, Long Islanders could face a slew of new tax hits in 2020.
Here’s what you need to know…
Limiting Your SALT Tax Deductions
If you haven’t felt it yet, when you go to file your income taxes in 2020 you might find you are able to deduct far less than in previous years. Property owners in NY can now only claim deductions for up to $10,000 in state and local taxes. Including mortgage interest and property taxes. The average Long Islander will have more than twice that in actual expenses.
New Nassau County Tax Assessments
To compound the impact of rising tax rates and the stripping of deductions, Nassau County has levied new tax assessment values on all properties. NBC reports this has lead to a $15,000 annual jump in taxes for some locals.
Rising Property Tax Rates
When was the last time you heard of property tax rates going down on Long Island? Probably never. Expect those rates and your annual property tax bill to increase again for 2020-2021.
New Real Estate Transfer & ‘Mansion’ Taxes
In the summer of 2019 NYC implemented new additional real estate transfer taxes and extra taxes on homes and apartments sold for more than $1M. If you are buying or selling property in 2020 you’ll see these show up.
Note, that if you are buying new construction property, struggling developers may help pay this tax if you are good at negotiating.
New 25% Tax On Reselling Homes
Bernie Sanders proclaims that when he becomes president in 2020 he will enact a new 25% tax on non-owner occupied homes resold in 5 years of less. So, if you won’t have lived in your NY property for the five previous years, expect to give up 25% of the sales prices to the government, on top of all of these other taxes. This combined with even harsher rent controls will likely destroy the real estate investment market. Local counties will be forced to further raise taxes to cover the maintenance on a slew of new zombie homes and apartments.
Vacant Property Taxes
Bernie has also pledged a new 2% tax on homes that sit vacant. This is going to add extra pain for vacation and second home owners, and those who haven’t been able to rent their places out. Sell or sit on it, you will get taxed.
Higher Federal Income Taxes
If the democrats win the election in 2020 expect a slew of increases to federal income taxes to pay for trillions of dollars in new programs. They may make it more appealing to rent, but homeowners and business owners will still need help grieving their property tax bills in order to sell and find buyers for their properties.