Property Taxes on Investment Property

The IRS has a new $10,000 limit on itemized deductions for state income tax, real estate taxes on homes, and personal property taxes like the ad valorem tax on cars. However if you pay real estate tax on investment property like raw land this tax deduction is not subject to the $10,000 limit so you can deduct a 100% of it. Beginning in 2018 foreign real property taxes are not deductible  as an itemized deduction.

Estate Exemption for 2019 of $11,400,000

Estates greater than $11,400,000 have to pay estate tax at a top rate of 40%. All or part of the exemption amount is also portable to the surviving spouse if you file form 706 which is the estate tax return form. The executor now has to also report the values of property transferred to beneficiaries to the IRS in a taxable estate.

Georgia Title Ad Valorem Tax

If you buy a new or used car in Georgia, you have to pay this tax which is a substantial 7% of the fair value of the vehicle. You also have to pay it if you bring a car into Georgia from another state and you want to get a Georgia tag. By paying this tax you no longer have to pay the annual ad valorem tax or any sales tax. From an income tax standpoint the title ad valorem tax is a nondeductible cost which adds to the basis of the vehicle.

529 Plan

A 529 Plan is a great way to put aside funds for your kids' college expenses for tuition, fees, books, supplies, and equipment. You don't get a tax deduction for contributions but the accounts grow tax free. You can also now use up to $10,000 per year from the 529 plan for kindergarten through 12th grade tuition per student. Contributions are not limited by taxpayer income and are considered gifts to your children. Georgia gives you a tax deduction for up to $4,000 per year per beneficiary for joint income tax returns if you invest in the Georgia Path2college 529 plan.