With over 30 years of experience in home building and land development in Florida and, as a CPA, I have to give a BIG CONGRATULATIONS to NAHB for the tax benefits they were able to obtain and preserve for small home builders and developers in the 2017 Tax Reform Act.
Although some might want to focus on benefits lost, such as the limitations on the deduction of mortgage interest and property taxes and changes to net operating loss provisions, in my opinion, there are benefits from other changes that far exceed what was given up in these and other areas.
The lower tax rates, adjusted tax brackets and 20% deduction for pass through income (with proper planning for shareholders and partners in such entities) together should result in most small home builders and developers seeing their effective tax rate decrease by 10% or more.
In addition, the elimination of the phase out provision for itemized deductions will prove to be a huge benefit during up cycle years for our industry since many business owners lost the benefit for as much as 85% of their itemized deductions due to the phase out.
The elimination of the Obamacare penalty (starting in 2019) should allow insurance companies to lower the cost of plans significantly for small business owners by allowing the plan to be customized to the needs of those business rather than using a one size fits all approach as Obamacare does.
GREAT JOB NAHB STAFF!