irs: What Kind of Properties are These? - 02/25/20 05:06 PM
  It is the way the property is used that determines the type of property it is, not what it looks like.  Based on the intent of the owner, the property could be a principal residence, income property, investment property or dealer property.
A principal residence is a home that a person lives in.  There can be only one declared principal residence.  It is afforded certain benefits like deducting the interest and property taxes on a taxpayers' itemized deductions, up to limits.  Up to $250,000 of gain for a single taxpayer and up to $500,000 for a married couple filing jointly … (0 comments)

irs: Temporarily Renting a Home - 06/06/19 03:32 PM
6/5/2019 IRS has provisions for homeowners regarding the sale of a principal residence that allows for temporarily renting the home without losing the ability to exclude the gain if the home is sold under the correct conditions.
The rules for the exclusion of gain on the sale of a principal residence are:
Up to $250,000 of gain may be excluded for single taxpayers and up to $500,000 for married taxpayers filing jointly. Ownership and Use must have been a principal residence for two of the five years preceding the date of sale (closing date).  This allows for a temporary rental for up … (0 comments)

irs: Standard or Itemized Deductions - 01/21/19 06:55 PM
  The Tax Cuts and Jobs Act of 2017 increased the standard deduction to $24,000 for married couples.  There will be some instances that homeowners may be better off taking the standard deduction than itemizing their deductions.  In the past, homeowners would most likely be better off itemizing but the $10,000 limit of state and local taxes (SALT) adds one more issue to consider.
Let's look at a hypothetical homeowner to see how a strategy that has been around for years could benefit them now even though they haven't used it in the past.  The strategy is called bunching; by timing the payments in … (5 comments)

irs: Year End Tax Newsletter - 01/08/19 08:10 PM
One of the first steps in a good outcome is knowing a little bit about what you're about to undertake.  By being aware of some of the areas regarding homes that may not come up every year in a tax return, you'll be able to point them out to your tax professional or seek more information from IRS.gov.
Look through this list of items for things that could affect your tax return.  Even if you have relied on the same tax professional for years to look out for your best interests, they need to be aware that there could be something different in this … (0 comments)

irs: Standard or Itemized - 03/20/18 02:11 PM
Standard or Itemized - 3/19/2018 

Taxpayers can decide each year whether to take the standard deduction or their itemized deductions when filing their personal income tax returns. Roughly, 75% of households with more than $75,000 income and most homeowners itemize their deductions.
Beginning in 2018, the standard deduction, available to all taxpayers, regardless of whether they own a home, is $24,000 for married filing jointly and $12,000 for single taxpayers.
Let's look at an example of a couple purchasing a $300,000 home with 3.5% down at 5% interest. The first year's interest would be $14,630 and property taxes are estimated at 1.5% of sales price would … (0 comments)

irs: More Money in Your Pocket - 04/11/16 09:25 AM
A homeowner’s tax savings benefit is generally realized when they file their federal income tax return after the money has been spent for the interest and property taxes. Some people look forward to the refund as a means of forced savings but some people need to realize the savings
during the year.
It is possible to adjust the deductions being withheld from the homeowner’s salary so they realize the benefit of the savings prior to filing their tax returns in the form of more money in their pay checks. Employees can talk to their employers about increasing their deductions stated on their W-4 … (0 comments)

irs: Homeowner Tax Tips - 03/04/15 03:12 PM
ven if you’re having a professional help you with your income tax return, you need to provide them with information on the money you spent that might be deductible.  Look at the following list to see if any of these things need a little more investigation to determine if they apply to your situation.
If you refinanced your home for the second or subsequent time in 2014, there may be points that can be taken as an interest charge. Compare mortgage interest, property taxes and other eligible itemized deductions to your standard deduction to see which will give you a larger … (0 comments)

irs: Updating Your Home or Rental? - 05/30/14 09:52 AM
Record Improvements Now  
There is a significant difference in how the money you spend on your home is treated for income tax purposes.  Repairs to maintain your home’s condition are not deductible unlike rental property owners who can deduct repairs as an operating expense.
On the other hand, capital improvements to a home will increase the basis and affect the gain when you sell which may save taxes.
Additions to a home or other improvements that have a useful life of more than one year may be considered an increase to basis or cost of the home.  Other increases to basis … (0 comments)

irs: Looking for the Largest Deduction - 04/12/14 07:40 AM
  Looking for the Largest Deduction   IRS allows taxpayers the option to take the standard deduction or the itemized deduction.  The astute taxpayer will compare to see which one will result in the greatest deduction and the election can be made each year.
The 2013 standard deduction for a married couple filing jointly is $12,200 and $6,100 for a single taxpayer.  It doesn’t require any proof of actual expense and has no requirement for home ownership.
Items that can be included on Schedule A for itemized deductions include: 
Certain taxes paid for state and local income tax, general sales tax, real … (0 comments)

irs: What's the Point? - 03/30/14 04:16 AM
  What's the Point? - 3/24/2014   Prepaid interest, sometimes called “points”, is generally tax deductible when a person pays them in connection with buying, building or improving their principal residence.  When points are paid on a refinance, they are not a current deduction but have to be taken prorata over the life of the mortgage.
For instance, if $3,000 in points were paid on refinancing a 30 year mortgage, a deduction of $100 per year is allowed.  When the loan is paid off or replaced by refinancing again or the home is sold and the mortgage paid off from the proceeds, the balance … (0 comments)

irs: When to Sell the Temporary Rental - 09/05/13 01:58 AM
 
When to Sell the Temporary Rental
Some homeowners, who were not able to sell during the recession, chose to rent their homes instead.  In some cases, they didn't need to sell their home at the depressed prices and opted to rent it until the market recovered.
It's a valid strategy but there are time restrictions that could have serious tax implications for some homeowners.
The section 121 exclusion for gain in a principal residence requires that the home is owned and used as a main home for at least two years during the five year period ending on the date … (2 comments)

irs: Tax Tips for Charitable Contributions in Aurora Co - 12/03/12 01:32 PM
Tax Tips for Charitable ContributionsWith the holidays approaching in the wake of superstorm Sandy, many of us are feeling extra giving this year. This is terrific, but we can also get some love in return for our good deeds come tax time.
Aurora Co has many organizations to choose from such as Colorado Community Church, Ronald McDonald House and many more.An estimated 117 million U.S. households gave to charities during 2011, according to Giving USA: The Annual Report on Philanthropy by the Giving USA Foundation and The Center on Philanthropy at Indiana University. On average, almost one quarter of charitable donations … (0 comments)

irs: When Mortgage Debt is Cancelled - 03/23/12 03:44 AM
When Mortgage Debt is CancelledThe Mortgage Forgiveness Relief Act of 2007 was passed by Congress to avoid additional financial hardship that some homeowners might experience due to a foreclosure or short sale. The law affects mortgage relief that occurs from January 1, 2007 to December 31, 2012.Normally, IRS considers partial or total debt forgiven by a lender to be treated as ordinary income. This not only affects foreclosures but even short sales where only part of the debt is forgiven would trigger additional taxes for the homeowner. There are exceptions that apply such as bankruptcy and insolvency.The forgiveness is only applicable … (0 comments)

 
Patty Clark, Helping Families Move with Care (Morningside Homes, LLC 720-231-5200) Rainmaker large

Patty Clark

Helping Families Move with Care

Denver, CO

More about me…

Morningside Homes, LLC 720-231-5200

Mobile: (720) 231-5200

Email Me

Patty ClarkCreate Your Badge


Listings

Links

Archives

RSS 2.0 Feed for this blog