2008 irs property tax deduction

2008 irs property tax deduction

Three sweet tax breaks in their first home!

Congratulations on purchasing your first home! It may be a house mobile home or condominium. You can deduct many expenses that relate to their new home. Enjoy!

1. A good credit IRS

If you are a first time buyer, you may be able to claim a tax credit for a time $ 7,500 ($ 3,750 if married and filing separately from) or 10% of the purchase price of your home, the lowest. You must have bought their home in the United States after April 9, 2008 and before July 1, 2009. So you should not have at home for a period of three years ending the date of purchase. If you have built your house he bought on the day moved home for the first time.

This credit is like an interest free loan and must be repaid within 15 years. You must be a citizen or resident and you should not have another home in Outside of the United States. You do not have to buy your house from a related person, and should not be a gift or inheritance. If your modified adjusted gross income exceeds $ 95,000 ($ 170,000 for married filing jointly), you can not claim this credit.

2. Mortgage interest

These days, a significant portion of mortgage payment goes toward interest early years. All these interests can be deducted from your income, unless the loan exceeds 1 million.

3. Property taxes

The amount of taxes Land paid during the year can be claimed as a deduction on your tax return. When you buy your home, payment of taxes for the year is shared between you and the seller. Its role is indicated on the map and regulations are fully deductible. However, any amount Future income taxes paid are not deductible. This money is deductible but do not itemize deductions on your tax return.

It are certain things you can not deduct property taxes. You can not deduct the amount paid for local benefits that tend to increase the value of your property. Thus, the cost for the construction of streets, sidewalks, and water and sewer are not deductible. In addition, no payment for services rendered by the local government are not deductible. You must look closely at your tax bill on real estate to find such load.

Remember, certain itemized deductions (including taxes and mortgage interest) are limited, if your Adjusted Gross Income (AGI) exceeds $ 159,950 ($ 79,975 if married to the presentation separately)

You keep a complete and accurate records to substantiate your deductions and credits. These documents include the purchase contract and settlement documents. You must also keep receipts, canceled checks and similar documents for improvements or additions to your home. In general, these documents must be retained for a period of three years, according to IRS rules.

About the Author

Chintamani Abhyankar, is a well known expert in the field of finance and taxation for last 25 years. He has written many books explaining inside secrets of the magic world of personal finance. His famous eBook Stop donating your money to IRS which is now running in its second edition, provides intricate knowledge and valuable tips on personal finance and income tax.

Personal Financial Planning Tips : How to Set Up a Trust

 

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Tagged with: 179 • 2008 • 2008_tax_changes • section_179_expense_deduction • small_business_tax_changes

Filed under: Tax Deductions

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