SALT

[Brain_Grabber]

On my 2020 taxes I show a SALT of approximately $11,000 including vehicle registration fees.  Turbo tax also shows a SALT adjustment (-$8,300) for SALT greater than $10,000.  I don't understand this adjustment if my SALT originally is only $11,000.

Although 2019 was very similar there was no adjustment for SALT > $10,000.

Regards,

Brain-Grabber

[gloriah5200]

The SALT deduction is limited to $10,000 per the Internal Revenue Tax Code for 2020 returns.

Real estate taxes (also called "property taxes") for your main home, vacation home, or land are an allowable deduction if they're based on the assessed value of the property and the property is for your own personal use. Whether you'll actually get a deduction on your taxes is another story, as several changes enacted by tax reform have impacted this deduction.

For one, you won't be able to deduct your property taxes if you're taking the Standard Deduction.

Even if you itemize, the SALT deduction, which includes property tax, is now capped at $10,000 ($5,000 for couples filing separately). This means taxpayers who live or own property in states with high property taxes may not be getting as big a deduction as they have in years past.

That said, you should still enter your property taxes in TurboTax. We'll figure out what amount, if any, is deductible. Be sure to include property taxes paid at closing as well as the annual property tax paid to your assessor.

Don't include:

• Taxes you paid on property you don't own
• Taxes for rental or business property (instead of entering them in the Deductions & Credits section, you'll claim them as expenses when you get to the rental or business section)
• Taxes for local improvements, like streets or sidewalks
• School taxes, unless they're based on the assessed value of your property
• Taxes for trash collection, libraries, or anything else not directly related to assessed property value
• Taxes on foreign property (tax reform has suspended this deduction for tax years 2018 through 2025)

Other tidbits:

• If your property taxes are included in your monthly mortgage bill, you can deduct them after your lender has paid the tax to the assessor on your behalf. Contact your lender to find out when they submit your property tax payments (frequently this is done twice a year, but it varies among jurisdictions).
• If you're a member of a co-op, only claim your share of the amount paid by the corporation.
• If you co-own the property with others, split the deduction by what each person paid.

Related Information:

• Where do I enter my real estate (property) taxes in TurboTax Online?
• Where can I find out how much property (real estate) tax I paid?
• Can I claim property (real estate) taxes paid for a prior or later year?
• What's the difference between real estate tax, property tax, and personal property tax?
• Can I claim property (real estate) taxes if I recently bought or sold my home?

For additional information, please refer to the following link:

Can I deduct property taxes

[VolvoGirl]

SALT is State And Local Tax.  Which includes property tax, any state tax paid like for last year’s return and includes any state withholding from your W2s and any 1099s you have. And any taxes in W2 box 14 and 19 like SDI or VDI. You can only deduct up to 10,000 (5,000 MFS) for SALT State and Local Taxes.

Are you including the state tax withholding?

[idmsguru]

I have a similar question. Last year (TY 2019) I was able to itemize with roughly the same numbers as this year. This year, Turbo Tax recommended the Standard Deduction. I've already filed but I don't see why there was a difference in SALT treatment between TY2019 and TY2020. Much like the OP, I now show $6615 over the SALT limit that wasnt there last year. Was there a change in SALT criteria?

[BillM223]

So far as I know, there was no change in the SALT criteria. But sometimes there may have been changes in your input that would not be obvious, as VolvoGirl alluded to such as various withheld taxes.

What were the values in lines 5a through 5d on your 2019 return?

[idmsguru]

16,736 (6036 and 10,700). 

[BillM223]

And which line was which value, and what was in each value? And did the amount get limited (line 5e)?

[idmsguru]

It was limited to $10,000. Total deductions were 32144. But I see what happened, my line 8 completely screwed up. It disallowed my mortgage interest. 

[BillM223]

So no issue for SALT in 2019? 

Now, what's the issue with your mortgage, or do you see what the issue is?

[idmsguru]

I see exactly what it was.  On the home mortgage interest worksheet - somehow (it could've been me) checked that the proceeds from this mortgage was used for other than the house - which disallowed the mortgage deduction. I corrected it and prepared the 1040x already (I worked for the IRS some 35 years ago so I have a basic knowledge of taxes)... just missed that box  - if it was my fault. I had problems with TurboTax this year - I'm not sure if it's the Mac version or whatever - but on another return I was stuck in the EIC loop. Crazy.  Thank you though - your advice was spot on. 

[idmsguru]

Sorry, I don't see 'Mark as best answer" - not an option on the ...   but it certainly was.