Tax Withholdings for New Homeowners

By
Real Estate Broker/Owner with 3:16 team REALTY ~ Locally-owned Prosper TX Real Estate Co. #9001154

There are many tax benefits to homeownership. One of them is to reduce our income taxes paid to Uncle Sam at the end of the year. A common mistake that new homeowners forget to do is to adjust their withholding exemptions adjustments on their paychecks.

Since mortgage interests are now a tax-deductible line item on your Form 1040 Income Taxes, you may be a candidate for Itemized Deductions on Schedule A instead of taking the Standard Deduction. If you had not made adjustments to your withholdings to anticipate for these additional benefits, you would more than likely have a tax refund at the end of the year. Why let Uncle Sam have your money interest-free?

The extra take-home pay you take back can be put to better use: savings, paying off consumer debts, or better yet take the extra money you have and put that back towards your mortgage as extra principal payments. That sounds like a sweet deal to me.

Standard Deductions for 2008 are:
Single(s) $5,450
Married couple(s) $10,950
Head of household(s) $8,000

Depending on when you purchase your home this year, you may or may not qualify for the Itemized Deductions. Also, don't forget to add your property taxes to the mortgage interests on Schedule A. Typically, these two line items make the largest number on the schedule. If you have old furniture you do not want to move into your new home, donate it. Uncle Sam also helps you with a charitable contribution line item on your tax.

To calculate your Withholding, visit Uncle Sam's IRS website here.

Fill out a new W-4 Withholding Form here.

Read also, my counter-part's blog (Bill Gassett of Metrowest MA Real Estate) on Tax Deductions to Remember When Getting a Home Loan.

If you are interested in finding your Homeownership Tax Benefit, check out Scott Burn's Calculator on the Dallas Morning News.

My advice would be for you to seek a tax consultant to work on your taxes so that you will maximize your tax benefits available to you.

 

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I proudly serve and sell real estate in the northern suburb cities of the Dallas metroplex. If you are thinking about purchasing or selling your home in neighborhoods of Frisco, Plano, Dallas, McKinney, Allen, Little Elm, Prosper, Celina, Richardson, Dallas M-Streets, Dallas White Rock Lake area and other surrounding areas and more importantly, want to work with a local area expert, contact me immediately.

It is a competitive market, hence it is important that you choose to work with the realtor who knows these communities like none other. I employ a systematic market approach in selling your home - an intentionally unique proposal that most real estate agents do not use. If you care to be on your way to a successful closing, contact me immediately to see how different my proposition will be.

Contact:
Loreena Yeo
Realtor®/ Broker of 3:16 team REALTY
(214) 783-2210
loreena@loreenayeo.com

 

 

Copyright © 2008 by Loreena Yeo (3:16 team REALTY). Tax Withholdings for New Homeowners.
Do Not Copy. Serious actions will be taken. Re-blog is allowed for Active Rain members on the Active Rain platform when the content is taken in its entirety and credit be given to Loreena Yeo and 3:16 team REALTY.

 

 

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Re-Blogged 4 times:

Re-Blogged By Re-Blogged At
  1. Belinda Sanchez, Realtor 12/05/2008 03:43 AM
  2. Kerry Lucasse 12/14/2008 11:25 AM
  3. Kristen Wahl 01/28/2009 08:21 AM
  4. MARY IACOVELLI 01/28/2009 11:49 AM
Topic:
Home Buying
Location:
Texas Collin County Frisco
Groups:
Realtors®
Home & Credit Savvy
1st Time Buyers
Buyer Information - What Buyers Need to Know in Today's Market
Advice for Buyers
Tags:
personal finance
tax witholdings
first time home buyers frisco

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Rainmaker
1,060,818
Bill Gassett
RE/MAX Executive Realty - Hopkinton, MA
Metrowest Massachusetts Real Estate

Loreena of course this is excellent advice. I appreciate your link to my post about the tax deductions to remember as well.

Dec 05, 2008 07:22 AM #1
Rainer
202,246
Greg Wilson
1st Cornerstone Realty - Schaumburg, IL

Loreena, I updated my withholdings this past year.  Thanks for providing such helpful information.

Dec 11, 2008 01:19 AM #2
Ambassador
1,486,677
Jim Crawford
Maximum One Executive REALTORS® - Atlanta, GA
Jim Crawford Atlanta Best Listing Agents & REALTOR

Thank you for sharing.  This is a must for everyone to know.  There are major tax advantages to home ownership.

Dec 11, 2008 01:40 AM #3
Rainer
7,030
Greg Morris
GGM Marketing - Winter Park, FL
Build Wealth With Greg

This is some great information if you can I would like for youto send me more info.

Thank you

Dec 16, 2008 03:09 AM #4
Rainmaker
140,138
Troy Jowers
Pogo Realty, LLC - New Orleans, LA
New Orleans Realtor

Hi Loreena! Thanks for the post, it's useful and concise. We are in the process of building a 1t time home buyer section on our website (www.come2nola.com). Would you mind if we repost (credit to you of course this on that section, or link to it? Thanks!

Troy Jowers, Realtor
New Orleans, LA

Jan 17, 2009 02:03 AM #5
Rainer
132,369
Jon Wnoroski
America's 1st Choice RH Realty Co., Inc. - Green, OH
Summit County Realtor

Hi Loreena - Tax information is something every new and current homeowner needs to know and understand.  Thank you for your post.

Jan 19, 2009 04:12 AM #6
Rainmaker
98,062
Kristen Wahl
Re/Max Plus - Rochester, NY
CBR

Loreena, great post! Thanks for sharing these valuable resources. You've been reblogged!!

Jan 28, 2009 08:24 AM #7
Rainer
29,424
MARY IACOVELLI
MARY IACOVELLI REALTY, LLC - Simpsonville, SC

Great Information, I'm going to ReBlog it!! Thanks for helping us ALL! Mary

Jan 28, 2009 11:48 AM #8
Rainer
123,025
Julie Neerings~Lifting Hearts ♥ Building Dreams~
Agent Referral - Salt Lake City, UT

Loreena~What a great value this information you provided brings to new home buyers.  There are so many incentives for them right now.  Have a wonderful day!

Feb 02, 2009 12:49 AM #9
Rainmaker
503,096
Lora "Leah" Stern 914-772-4528
Coldwell Banker, 170 N Main Street, New City NY 10956 - New City, NY
Real Estate Salesperson

Thanks for all the info!  Great post.  Why not include info on first time homebuyers tax credit too.

Feb 03, 2009 11:53 AM #11
Rainer
76,821
Michael Neville
Keller Williams Realty Atlanta Midtown - Atlanta, GA
Intown Atlanta Realtor

Wonderful post - looks like you've got a background or connection to a CPA with the amount of detail your providing. Thank you, very valuable.

Feb 09, 2009 10:20 AM #12
Rainmaker
19,440
Corey & Erika Kahler
The Cascade Team - Kirkland, WA

Thank you so much for posting such important and valuable information.  I will definitely be passing it along to my clients!  Keep up the good work!!!

Feb 12, 2009 09:45 AM #13
Rainer
202,246
Greg Wilson
1st Cornerstone Realty - Schaumburg, IL

Hopefully all of the new incentives, I hope the market starts to pick up.

Feb 12, 2009 09:47 AM #14
Rainmaker
94,324
Sharon Harris
Keller Williams Keystone Realty - Hanover, PA
Realtor

Power is knowledge. You bet lots of new homeowners have not a clue about taxes.

Feb 13, 2009 01:16 AM #15
Rainmaker
472,405
Janice Roosevelt
Keller Williams Brandywine Valley - West Chester, PA
OICP ABR, ePRO,Ecobroker

Loreena, this is great stuff . Thank you

Feb 13, 2009 11:15 PM #16
Rainer
14,751
K.T. Ruthven
McKinney Realty of Aiken - Savannah River Plant, SC
ePro

Loreena, Thanks for the great blog.  I'm going to make sure all my "on the fence" buyers are given this info. I appreciate the info.

Feb 17, 2009 11:03 PM #17
Rainmaker
108,925
Linda DeRusha
Coldwell Banker Advantage - Garner, NC
Broker/Realtor, ABR,ASP,CDPE

Loreena,

thank you for this informative post. There is lots of good info here for first time home buyers.

have a great day,

Linda W DeRusha

Feb 18, 2009 12:39 AM #18
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