Why are interest rates so low?

[Snobdds]

It is true for the middle class, most of us non business owners lost deductions and got a crappy standard deduction that didn’t make up for the lost deductions. There were some other benefits for those in the low income category.

They doubled the standard deduction to prevent itemizing all the questionable write-offs.

In 2025 when the 2018 tax bill sunsets...I bet your taxes go up. Lets revisit this then...so I can say, I told you so.

 

[Torvy]

Another reason your taxes may have gone up is if you live in a state with high taxes, you can only deduct up to 10k (iirc). States have been effectively shifting tax burden to the national government through these deductions. It would be better if no state taxes could be deducted on federal. Why? It masks your taxes. If you want lower taxes, you can approach your state reps to lower state taxes.

 

[MossRoad]

It is true for the middle class, most of us non business owners lost deductions and got a crappy standard deduction that didn’t make up for the lost deductions. There were some other benefits for those in the low income category.

The standard deduction was $12,550 for singles or married filing separate, $18,800 for single head of household, and a whopping $25,100 for married filing jointly.

My wife and I itemize every year since 1985, and we have NEVER beaten the standard deduction.

Yes, this year was the first in a long time that we actually had to pay, but that's what I want. I want my money up front where I can use it immediately and don't want to wait to file my taxes to get it back. It's ours!

 

[ultrarunner]

Low may be relative in that mortgage rates have definite increased…

 

[jyoutz]

The standard deduction was $12,550 for singles or married filing separate, $18,800 for single head of household, and a whopping $25,100 for married filing jointly.

My wife and I itemize every year since 1985, and we have NEVER beaten the standard deduction.

Yes, this year was the first in a long time that we actually had to pay, but that's what I want. I want my money up front where I can use it immediately and don't want to wait to file my taxes to get it back. It's ours!

They took away the 2nd mortgage interest deductions. That destroyed our tax situation.

 

[jyoutz]

They doubled the standard deduction to prevent itemizing all the questionable write-offs.

In 2025 when the 2018 tax bill sunsets...I bet your taxes go up. Lets revisit this then...so I can say, I told you so.

They took away the 2nd mortgage interest deductions, which the increased standard deduction didn’t make up for.

 

[Torvy]

They took away the 2nd mortgage interest deductions, which the increased standard deduction didn’t make up for.

Which is only fair. The whole point of mortgage interest deductions is to help people afford their 1st home. Most people who have 2nd mortgages are spending it on other stuff (or using the lower rates on mortgage loans to offset other spending).

You must have a huge mortgage or tremendously bad credit to have that deduction make that much difference. Must be nice to be a rich government employee.

 

[Raul-02]

Putting $20,000 into CDs now means they will be worth less than $10,000 in 5 years after inflation.

CDs are no longer a worthy investment strategy.
Expensive fine art appreciates at many times the rate of the stock market.
Equities are still the best and most consistent game. Get with a good house like Janny Montgomery Scott,
A good mutual fund can be a smart place to park money. Back when I was paying attention, Vanguard was the only one that was truly mutual.
I don't trust the big names like Schwab Fidelity etc.. If they are running TV ads I won't touch 'em.
I tried to invest on my own, That was dumb.
CDs are so three decades ago.

 

[jyoutz]

Which is only fair. The whole point of mortgage interest deductions is to help people afford their 1st home. Most people who have 2nd mortgages are spending it on other stuff (or using the lower rates on mortgage loans to offset other spending).

You must have a huge mortgage or tremendously bad credit to have that deduction make that much difference. Must be nice to be a rich government employee.

I used the second for remodeling our house. I did it because it was the best financial option when the housing values tanked in 2008, and all mortgage interest on a primary residence has always been deductible until 2018 tax bill changed the game. Refinancing isn’t cheap either. We are middle class, with two incomes, and that’s a cheap dig about my employer. As an economist you know that public service jobs pay less than the private sector.

 

[MossRoad]

They took away the 2nd mortgage interest deductions. That destroyed our tax situation.

I wouldn't know about that. Even when we had a mortgage, we never beat the standard deduction. We are in a fortunate situation.