Tax reform -- changes impacting 30% federal tax credit

[CharlieEscCA]

As far as I can tell, thus far neither the House or Senate has proposed changing the 30% tax credit that exists thru 2019.

I'm creating this thread to track this as who knows what bill if any will make its way to the point of being signed into law.

[J.P.M.]

At this time, smart money thinks existing law will be allowed to expire. After that ??

Charlie: How's your new house coming along ? I'm watching one being built a bit east and south of the airport. That you ?

[CharlieEscCA]

How's your new house coming along ? I'm watching one being built a bit east and south of the airport. That you ?

Nope, not me. My project is coming along slowly. Right now it's a little bit of back and forth between the architect and the civil engineer. The architect had a floor plan but grading wasn't going to support it (needed to get a driveway to the garage location). The architect has revised the floor plan, but now waiting for the civil engineer to see if the grading will work. The challenge is to stay within the 2500 cubic yards of a minor grading permit lest cost and approval time head to where I don't wish to go.

Best case is preliminary grading gives ok to proceed with floor plan, then probably 6 to 10 weeks to get to house plans and grading plan ready to submit to county, then 2 to 3 month approval to get to permit, 2 to 4 weeks to grading done and approved, then 7 to 10 months to build.

I'd love to be in by end of 2018, but looking like a bit of a long shot. But, still looking for a solar 2019 tax credit

[sensij]

The $7500 EV credit is getting nuked though, right? Maybe worth tracking too, although given the high overlap between solar owners and EV drivers.

[J.P.M.]

Nope, not me. My project is coming along slowly. Right now it's a little bit of back and forth between the architect and the civil engineer. The architect had a floor plan but grading wasn't going to support it (needed to get a driveway to the garage location). The architect has revised the floor plan, but now waiting for the civil engineer to see if the grading will work. The challenge is to stay within the 2500 cubic yards of a minor grading permit lest cost and approval time head to where I don't wish to go.

Best case is preliminary grading gives ok to proceed with floor plan, then probably 6 to 10 weeks to get to house plans and grading plan ready to submit to county, then 2 to 3 month approval to get to permit, 2 to 4 weeks to grading done and approved, then 7 to 10 months to build.

I'd love to be in by end of 2018, but looking like a bit of a long shot. But, still looking for a solar 2019 tax credit

Understood. Been there. Thanx for the update.

[SunEagle]

The $7500 EV credit is getting nuked though, right? Maybe worth tracking too, although given the high overlap between solar owners and EV drivers.

I wonder with the EV credit going away and how it will affect Tesla?

[J.P.M.]

I wonder with the EV credit going away and how it will affect Tesla?

In one sense, for as few cars as they seem to be delivering, and failed promises about production goals, maybe not so much.

In another sense, my guess is folks who are buying tesla's available products do so more on emotion than other buyers buying other vehicles, including other EV's. If so, or to the degree that's a reasonable part of reality, if the EV credit goes away, it may have less impact on potential Tesla buyers than buyers or other vehicles, with the resulting impact on Tesla maybe not as much as one might think..

Seen the latest $2.5 EE5 pipe/wet dream that came packed in the tesla truck like a nested Russian doll ? Unless the Bloomberg piece is a misprint, which seems likely, I'd question how that much stated torque can be utilized, safely or otherwise.

[JSchnee21]

Was wondering the same re: Solar credit.

Well, here's hoping tax reform legislation fails. As a resident of NJ, I very much enjoy (perhaps that's not the right work) being able to deduct my mortgage interest, property taxes, and most importantly state income taxes. Not to mention the 30% Federal Solar deduction (~$15K) I planning to take next next year. 4x the new STD Deduction (4x$12K I believe) is only 57% of what I deducted last year.

Thought the AMT tax man is starting to take a bite.

[JSchnee21]

Looks like my math was a little off. Seems a family of four cannot get 4x the new STD Deduction. Rather its capped at $24K. Assuming I can claim up to $10K in property tax and $10K in mortgage interest in addition to the $24K, this would be a $44K deduction versus the $48K I had calculated above. So more like ONLY HALF of what I deducted last year (most of this is state income tax that would no longer be deductible). But my tax rate would go down 3% -- Yippee!!! (note sarcasm).

Wow, this sounds great. Can we all vote Democratic now so we keep our existing social services and healthcare AND STILL PAY LOWER TAXES? Oh, and maybe not start a war with North Korea (-: I'm not trying to start a flame war, I'm seriously open to a wide variety of political options and opinions. But in what reality could any of this possible make sense. Trickle down economics (now called supply side economics) didn't work for Reagan (or anyone other politician) and it won't work for Trump.

I've worked for large fortune 100 firms for the past 20 years. Not a single one is going to give their employees a raise because they got a tax break. They don't pay anywhere near the listed tax rate as it is now. They'll tax the extra money, sit on it or pay it out in dividends (and golden parachutes) layoff some more American worker and close plants, build a boutique "shop" in Boston or San Francisco, and then offshore all of the work to the lowest bidder.

Personally, I think we need a flat tax, and then we can put all of money into a Lock Box to stop Global warming. Its an inconvenient truth that Florida's hanging chads were rigged! Perhaps it was the Russians (-:

Smile, I'm only kidding. They're all crooks, womanizers, and pedophiles. God Bless America!

[J.P.M.]

Looks like my math was a little off. Seems a family of four cannot get 4x the new STD Deduction. Rather its capped at $24K. Assuming I can claim up to $10K in property tax and $10K in mortgage interest in addition to the $24K, this would be a $44K deduction versus the $48K I had calculated above. So more like ONLY HALF of what I deducted last year (most of this is state income tax that would no longer be deductible). But my tax rate would go down 3% -- Yippee!!! (note sarcasm).

Wow, this sounds great. Can we all vote Democratic now so we keep our existing social services and healthcare AND STILL PAY LOWER TAXES? Oh, and maybe not start a war with North Korea (-: I'm not trying to start a flame war, I'm seriously open to a wide variety of political options and opinions. But in what reality could any of this possible make sense. Trickle down economics (now called supply side economics) didn't work for Reagan (or anyone other politician) and it won't work for Trump.

I've worked for large fortune 100 firms for the past 20 years. Not a single one is going to give their employees a raise because they got a tax break. They don't pay anywhere near the listed tax rate as it is now. They'll tax the extra money, sit on it or pay it out in dividends (and golden parachutes) layoff some more American worker and close plants, build a boutique "shop" in Boston or San Francisco, and then offshore all of the work to the lowest bidder.

Personally, I think we need a flat tax, and then we can put all of money into a Lock Box to stop Global warming. Its an inconvenient truth that Florida's hanging chads were rigged! Perhaps it was the Russians (-:

Smile, I'm only kidding. They're all crooks, womanizers, and pedophiles. God Bless America!

We all have opinions, and I probably agree with some of the above, but this isn't the place for political discussion.

For my money, this post is closer to crossing the political line than is appropriate for this venue.

The sign over the door says "SolarPanelTalk". I bet the forum will be healthier and be a better info source for disseminating R.E. information if topics stay that way.

[BackwoodsEE]

We all have opinions, and I probably agree with some of the above, but this isn't the place for political discussion.

For my money, this post is closer to crossing the political line than is appropriate for this venue.

The sign over the door says "SolarPanelTalk". I bet the forum will be healthier and be a better info source for disseminating R.E. information if topics stay that way.

Agreed. I often spend time reading and thinking about solar in an effort to escape from politics!

Regarding the Tesla truck, my feeling is that the smell coming from Elon Musk's vaporware factory is getting ever more pungent. It's expensive, from an academic publisher, but I highly recommend When the Trucks Stop Running by Dr. Alice Friedemann for a sobering look at the limitations of vehicles that are not powered by fossil fuels, and the uncertain future of those that are.

[JSchnee21]

Sorry, my bad. You're right. 'Nuff said.

[J.P.M.]

Sorry, my bad. You're right. 'Nuff said.

No bad to me. Nothin' to be sorry about. Just opinion and it's all valid. Just that some's better expressed in other venues is all.

[CharlieEscCA]

Looks like my math was a little off. Seems a family of four cannot get 4x the new STD Deduction. Rather its capped at $24K. Assuming I can claim up to $10K in property tax and $10K in mortgage interest in addition to the $24K, this would be a $44K deduction versus the $48K I had calculated above.

I don't want this whole post to go political (recall I started this thread), but your assumptions above are wrong.

You either take the standard deduction or itemize. Therefore, you need to have more to itemize than the standard deduction for itemize to be beneficial.

The House tax bill (for a married couple) substantially penalizes the person with high itemized deductions independent of deductions that disappear or become capped.

Let's say you deductions are $25,000 in 2017. You thus have 25K in deductions plus two personal exemptions of $4050 per person, a total of $33,100 taken of your taxable income.

So, in 2018 (if the House bill was to become law, which it will not in its present form), you still itemize the 25K as it's greater than the 24K standard deductions, but your $8100 in personal exemptions are gone as they got consumed into the standard deduction. Thus, you my friend now have $8100 more in taxable income.

The bottom line is that the "cost" to a couple who will still have itemized deductions over the standard deduction of $24K is $8100 plus whatever former deductions are gone and/or capped.

In order to benefit from the higher standardized deductions, your former itemized deductions would need to have been below $15,900 -- this comes about from taking the new standard deduction of $24,000 and subtracting the former personal exemptions of $8100 for a married couple. The max benefit of the house plan will go to anyone who was using the standard deduction before as they will gain an addition $3200 deduction (the former standard deduction was $12,700; add the $8100 exemptions and you get $20,800 before vs $24,000 in the House bill).

The bottom line is the taxman takes from some and gives to some others. Remember, death and taxes are unavoidable...