AUSTIN (KXAN) — Texas homeowners will likely lose several thousands of dollars due to a limit on property tax deductions, a new change to tax law beginning this year.
Property tax deduction in Texas has been limited to $10,000 for families or $5,000 for couples who are married but filing separately, according to certified public accountant in Austin, Tony Ramos.
This comes as taxpayers across the nation are reporting lower refunds than years past under the first full year of the Trump Administration’s overhauled tax code.
The Internal Revenue Service says the average refund so far is down about eight percent.
Refunds for early filers average $1,865. That’s compared to $2,035 for the 2017 tax year.
The tax changes, for the most part, are resulting in lower refunds for taxpayers with dependents because personal exemption deductions were reduced from $4,050 per taxpayer and dependent to zero.
The change was mitigated by the doubling of the Standard Deduction, Ramos says. However, the majority of taxpayers are ending up with fewer deductions.
Lastly, in Texas, the property tax deduction for homeowners has been limited, which reduces the likelihood of itemizing your deductions and will likely lead to several thousand dollars in lost deductions.