Tax Deductions for Homeowners
Taxes are due this week! (AHHH!) This is an article I found through MSN.com about common tax deductions that homeowners forget about:
10 Commonly Missed Tax Deductions for Homeowners
By Robert J. Bruss
Content provided byHave you ever forgotten to claim a tax deduction until after you sent your tax returns to the IRS? I have. Several times, in fact. The result was that I later filed an amended tax return on IRS Form 1040X.
One time, while cleaning out a desk drawer, I luckily discovered a substantial forgotten tax deduction I should have claimed on my tax returns filed two years earlier. Fortunately, tax returns can be amended up to three years from the date they were due.
But it’s better to claim all the deductions when the tax return is filed because amended tax returns often trigger a tax audit before the IRS will issue a refund check.
Especially if you bought, sold or refinanced your home, you might have forgotten to claim some big tax deductions. Here are the most often forgotten real estate tax deductions:
1. Deduct principal residence acquisition mortgage fee if you bought a home last year. If you bought your principal residence last year and if you paid the mortgage lender a loan fee, usually called “points” (each point equals 1 percent of the amount borrowed), that “home acquisition mortgage loan fee” is tax deductible as itemized interest on Schedule A of your tax returns…
2. Remember to deduct home mortgage refinance loan fees over the life of the home loan. If you refinanced your home loan or obtained another type of real estate loan, any loan fee or points you paid can only be deducted over the life of the mortgage, such as 15 or 30 years…
To avoid the hassle of remembering to deduct the small loan fee amount each year for 15 or 30 years, many refinancing home loan borrowers prefer to pay a slightly higher loan interest rate. Another reason to avoid paying a loan fee when refinancing is most home loans are paid off in less than 10 years, either due to property sale or a subsequent mortgage refinance.
3. Deduct undeducted loan fees from a prior home loan refinance. If you refinanced a previously refinanced home loan, don’t forget to deduct any remaining undeducted loan fee in the tax year of the second refinance…
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