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Mortgages at Tax Time

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taxes_001If you are getting ready to do your taxes, and you are renting…

P-I-T-Y!  I mean really, Bro… too bad.

You are missing out on THOUSANDS of dollars! People who OWN a home, get tons of Mortgage Tax Deductions you don’t… just for living in a HOME!  Haven’t you ever heard the saying, “Buy a House Get a Raise!”

Mortgage Interest Deduction:

You may not deduct interest on more than $1,000,000 of home acquisition debt for your main home and secondary residence. Home acquisition debt means any loan whose purpose is to acquire, to construct, or substantially to improve a qualified home. The limit is reduced to $500,000 if you are married filing separately.
Use the worksheet on page 11 of Publication 936 to calculate the allowable mortgage tax deduction.
Let’s say you purchased a home in February of 2013, with an interest rate of 4.5% with a loan balance of $200,000. Your monthly Principal and Interest Payment would be $1014.  Your first payment would be April 1st.
The Interest you paid April through December would be $7741.98.

This doesn’t include any other charges you might be writing off… like TAXES on the mortgage! PMI is also tax deductible for many people, and this is a HUGE Benefit! Mortgage Tax Deductions are everywhere!
So when you’re doing your taxes… just for fun… add a $7741.98 deduction in Schedule A, and see what kind of difference it makes for YOU!

WOW!  If you are renting… you could really, REALLY be missing out! Seriously, what could YOU do with an extra $2,000?  Mortgage Tax Credits are STILL Available in 2014!

Suppose you qualify for the Mortgage Tax Credit (MCC) and obtain a 30-year, 4% fixed-rate mortgage of $125,000. The first year’s interest payment is approximately $4,960.  The MCC allows you to take a federal income tax credit of $1,488 ($4,960 x 30%) for that year.

If your federal income tax liability is $1,488 or more after you have taken all other credits and deductions, you receive the entire benefit of the MCC tax credit – $1,488.  In figuring your taxes, you also claim a deduction for the remaining 70% of your mortgage interest.

Figuring you could use a Mortgage Tax Deduction?  Call Steve and Eleanor Thorne, Connect With Us on Facebook, Raleigh, NC  919-649-5058!  Remember – USDA Home Loans and VA Mortgage Loans do not require any down payment!

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