Maybe that AMT booboo will force another senate vote - coal doesn’t like it http://money.cnn.com/2017/12/06/investing/coal-tax-cuts-robert-murray-trump/index.html
@romanigypsyeyes, I’m pretty certain interest deduction on HELOC is taken away in both bills. Mtg deduction is still in, but in House bill it’s capped at interest on first $500k.
Differences that need to be worked out in conference.
I talked to my CPA and he feels this tax bill will be a net win for my family. And no, we aren’t rich and don’t have lobbyists working on our behalf so his news was a happy surprise.
I won’t know how it will affect us until my CPA…I mean I…go out and buy TurboTax for 2018 which I do not expect to do until sometime in Feb/March of 2019. Will need to make estimated payments based on safe harbors.
I found this current (published 20 hours ago, updated 2 hours ago) analysis from CNBC. It’s tough using google to find out what’s in the senate bill. You have to make sure the article was written AFTER the bill was passed, and also try to determine if the author actually got their info from reading the bill or heard it from someone. Lots of room for errors here! But they said:
Sorry, but that’s just stupid. So instead of taking out a HELOC and having for example a $300k mortgage + a $100k Home equity loan they will have a strong tax/financial incentive to refinance the $300k mortgage with a $400k mortgage.
I’m getting a HELOC for extra breathing room in case I have to leave my program and for possible baby expenses. Now I’m wondering if I should refi instead. I really don’t want to go through that again plus I’m not sure we’d even qualify now. Boo 
The problem with HELOCs is that it allows consumers to turn interest on regular, non-housing consumer debt into deductible interest.
Buy a car, get a car loan -> interest not deductible
Buy a car with a check from your HELOC -> interest deductible
Even though there are already rules about the amount that is deductible and what the loan proceeds are used for in order for the interest to be deductible, there is pretty much no way to verify any of this without an audit.
I tried to find data on what percentage of HELOC dollars are actually used on home improvements, but came up empty. I feel like a large amount is financing people’s vacations, cars, other investments, etc.
I doubt Turbotax will give an accurate estimate for quarterly taxes by the time first payments are due. And @threebeans – ask your accountant how this will likely for you several years down the road. You might not feel so happy. Honestly, even if I get a cut, I’m not happy for what it does to the federal deficit and for the spending cuts to less well off people it is likely to result in. No one needs more gold plated toilets.
We used 100% of our HELOC on remodeling our home. We just refinanced this summer into new mortgage at 3.2% I’d never use it for anything other than home improvement, but that is just me.
And the biggest winner in the tax bill sweepstakes is you will never guess 
@intparent I don’t even attempt to plan our taxes further out than 5 years. The rules for so many things that determine my personal taxes change far too often. 15 years ago we started a business because we could get health insurance for a lot less on an individual plan vs. the group plan offered. Fast forward to Obamacare and our premiums have tripled. So for better or worse, I plan for the short term, and if I get a bit of a break for the next three years, It will help fund my sons college tuition. So, he wins too.
I doubt it will either. I do not expect it to provide accurate estimates for quarterly tax payments now. Just safe harbors. For 2018 taxes, I expect to make estimates based on safe harbors. For Jan '19 payment, I may well buy TurboTax 2018 in early January 2019, run a quick estimate of what tax liability will be for 2018 and make last estimated payment based on the delta.
Here’s another on the coal thing. Murray says it’ll wipe them out: http://thehill.com/news-by-subject/energy-environment/363496-coal-ceo-gop-tax-bill-wipes-us-out-destroys-thousands-of
If Republicans approve a tax bill that will inadvertently wipe out coal companies, they’re just bad at legislating. This is legislative malpractice.
Whatever one thinks of the merits of altering the tax code, if the writers of the bill accidentally miss a quarter trillion dollar effect that harms entities they want to help, they’re bad at legislating.
Can’t govern will be the (deserved) rap.
Will you be able to itemize deductions under either of the tax plans?
If not then just get a HELOC. They are easier and much cheaper to get, generally. The one I got less than a year ago had $0 application costs and $0 closing costs, and came with a discounted rate for 6 months.
Even if you will be able to itemize, how much of a deduction are you looking at? IOW, how much HELOC debt will you be taking on? If you borrow $20K at 4%, for example, that’s only $800 in interest, and will at most save you a few hundred in taxes. The cost to refinance will likely be much higher than that.
Plus, if you pull money out via refinancing, you are paying interest on it from day 1, instead of when you need the money.
I second what NRE said. Treat the HELOC as your emergency reserve instead of a cash stash.
Yes, I will be able to itemize this year.
Yes, I am using it for emergency funding only or to renovate for baby.
My line is up to about 100k. No, I don’t intend on going anywhere near that. 20k is about what we’re comfortable with at the most.
I’m getting it now rather than waiting until a crisis happens.
A good rule of thumb is to not get any $$ of HELOC that would drop your equity to below 20%. A RE “round trip” costs about 10% of the sales price (broker fees, escrow fees, excise tax), etc. You don’t want to be underwater if you need to sell.
I have about 120k equity in the house so I won’t go anywhere near that. But thank you for that- it’s helpful!!
For this small of an amount, refinancing doesn’t make sense. HELOC is a much better approach, even if you won’t be able to deduct the interest.