Tax Tip #2: Paying Interest on a Mortgage

With the tax deadline around the corner, we thought we would provide a few homeowner-related tax break tips over the next couple weeks that may help you. #2: Paying Interest on a Mortgage Your lender will be sending you a 1098 form that details how much interest you paid last year. Most likely your loan is less than $1 million (or $500,000 for those married but filing separately). In that case, you are allowed to deduct 100% of your interest and property taxes. If your mortgage exceeds this, the IRS will limit the amount that you can deduct. In order to claim this deduction, however, a bit of itemization is required. To do this, you must...

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Tax Tip #1: Selling your home and making a profit

The tax season is now upon us. We will be posting homeowner-related tax break tips over the next couple weeks that may help you. #1: Selling your home and making a profit: Congratulations! This is hard to do in this economy. Selling your home for more than you paid gives you a "capital gain". This gain that you made on your home is exempt from income taxes as long as you meet the following criteria: The gain is less than $250,000 single, or $500,000 for married couples filing jointly You owned the home for at least two years You lived in it for two out of the last five years before selling If you do not meet these requirements, the IRS...

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