DTC Impact on Real Estate

The reimbursement of principal of your home loan will not be eligible for tax deduction under the DTC. The removal of tax on notational rent is good news. At present if you own more than one house you have to pay tax on notational rental income even if second house is lying vacant. The DTC will eliminate this anomaly and make investment in second home more tax efficient. An additional landlord friendly move is that advanced tax acknowledged from a tenant will be taxed in year it relates, not when it was received. DTC, more importantly has maintained tax benefit on the interest paid on home loan. The tax benefits decrease the effective cost of home loan thus making it reasonable for borrowers.