Do you own a second home/vacation property? It may be time to convert it to an investment property. As of January 1, 2018, there is now a limit to three major itemized deductions for those who own second homes:
- $10,000 (maximum) combined property tax limitation
- Cap on Mortgage Interest deduction for up to $750,000 of mortgage debt incurred to buy or improve a first or second residence
- Home Equity Loan and Line of Credit Interest is No Longer Deductible
If appropriately structured and the second home is converted to an investment property and rented out (there are limitations), you may be able to deduct all or a portion of these expenses. There are also creative trust structures that we can deploy to help maximize the deductibility of property taxes on larger homes where the tax bills range from $20k to well over $100k per year. Contact Atlantic Wealth Partners for more information.
