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Will having homes in N.J. and Florida be a smart move?

By Karin Price Mueller | for

Q. I’m a New Jersey homeowner considering selling the house and moving into an apartment. We don’t want the maintenance anymore. The profit from the home sale will allow us to purchase a condo in Florida, which will not be used as a rental. Our primary residence would continue to be in New Jersey. I’m still working and not planning to retire in the near future but my spouse is retired. We’re not sure if this is financially smart and unsure of tax implications.

— Trying to decide

A. Let’s start with the income tax aspects of your question.

As a homeowner you can deduct your mortgage interest, real estate taxes and state income taxes on Schedule A of your federal income tax return, said Bernie Kiely, a certified financial planner and certified public accountant with Kiely Capital Management in Morristown.

He said the Tax Cuts and Jobs Act of 2017 reduced the deduction for state and local taxes (SALT) to a maximum of $10,000.

“Many taxpayers who have a small or no mortgage are no longer itemizing their deductions because the standard deduction has been increased,” he said.

For 2020, the standard deduction for a single filer is $12,400. For a couple it is $24,800. If you are over age 65 you get an additional $1,650. A couple both over 65 will get an additional $2,600, Kiely said.

“If you buy a condominium in Florida for cash and move to an apartment in New Jersey you will certainly take the standard deduction,” he said. “You will have no mortgage interest and only Florida real estate tax.”

There are no federal tax deductions for rent paid, he said.

New Jersey assumes that 18% of your rent payment goes to real estate taxes, which are deductible on your New Jersey resident income tax return

You ask if your plan is financially smart. Only you can determine that.

“I can understand you wanting to get out of all the financial and maintenance headaches of home ownership. The real question is whether having a home in New Jersey and another home in Florida is sustainable in retirement,” he said. “If it is not sustainable in retirement, then you should prepare yourself to get rid of your New Jersey apartment or your Florida condominium.”

Email your questions to

Karin Price Mueller writes the Bamboozled column for NJ Advance Media and is the founder of Follow NJMoneyHelp on Twitter @NJMoneyHelp. Find NJMoneyHelp on Facebook. Sign up for’s weekly e-newsletter.


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