Archive for Tax Tips
Lake Geneva Mortgage Tax Deductions
Looking for an extra 2010 tax deduction? Consider making your January mortgage payment a few days early.
It’s a simple strategy that works because of how mortgage interest works.
Unlike rent which is paid in advance at the start of a month, mortgage interest is only paid after it’s been borrowed. Your January mortgage payment, therefore, accounts for the interest that accrued in December.
And for a lot of Lake Geneva real estate homeowners, that mortgage interest is tax-deductible.
By making January’s mortgage payment in December, eligible homeowners can apply the interest paid to 2010′s tax returns instead of waiting to claim the same deduction against 2011. Don’t cut it close, though. It’s best to remit payment prior to the last week of the month, leaving your servicer ample time to receive and process your paperwork.
Most importantly, though, before prepaying on your mortgage, talk to your tax professional.
Not every homeowner is eligible for mortgage interest tax deductions, nor should every homeowner itemize their respective tax deductions. The “pay early” plan could be a wasted effort for you, ultimately, depending on your taxpayer profile.
If you don’t have an accountant that you trust, call or email me anytime; I’m happy to make a recommendation to you.
As its June 30, 2010 closing deadline approaches, the federal home buyer tax credit is back in the news.
Unfortunately, the headlines are misleading.
Contrary to what you may have read (or heard), the federal home buyer tax credit has not been extended past June 30, 2010. At least not yet. And here’s why there’s confusion.
Look at these headlines from earlier this week:
- Senate Extends Date On Home-Buying Tax Credit (Philadelphia Inquirer)
- U.S. Senate Approves Extension Of Home Buyer Tax Credit (NASDAQ)
- Senate Approves Home Tax Credit Extension (Reuters)
Now, nothing above is factually incorrect, but each neglects a key piece of the country’s law-making process — it takes more than the Senate to pass a law. For a bill to become a law, it must pass the Senate and the House of Representatives and then it must be ratified by the President.
To date, we’ve only cleared just one of those 3 steps.
This means that the federal home buyer tax credit has not been formally extended. As of now, it’s still in discussion. Ultimately, though, if the extension does pass, it’s expected to extend the closing date deadline for Lake Geneva real estate home buyers beyond the original June 30, 2010 date into September 2010.
Home buyers must still have been in contract as of April 30, 2010 to claim up to $8,000 in federal tax credits.
Taxes are due April 15 and if you’re among the millions of Americans who wait until the last week to file, here’s a video interview that could help you reduce your federal tax liability.
Originally broadcast by NBC’s The Today Show, the 4-minute piece reviews various tax credits and deductions, plus some recent tax law changes. A few of the topics covered include:
- Tax filers receiving larger “personal exemptions” in 2009 versus 2008
- Unemployment income recipients being required pay taxes beyond the first $2,400 received
- The “first time” home buyer credit being extended to non-first time home buyers for up to $6,500
The interview also talks about how taking a parent, child or other family member into your home may change your tax filing status and reduce your tax liability.
Even if you’ve filed your taxes already, watch the video above. You may find that you missed a potential deduction. If that’s the case, consider filing an amended return with the IRS to recapture the credits you left on the table. Most times, the benefits of re-filing will outweigh the costs of doing it.
Be sure to talk with your tax professional for personal tax advice.
|
Asst Vice President
1221 South Shore Drive
Delavan, Wisconsin, 53115 US |
Work: 262-728-6209
Mobile: 262-745-5055
 |
|
|
Lender, Lake Geneva Real Estate
              |
||