PRINT
EMAIL
COMMENT
BUZZ UP
DIGG THIS- Ask Kim - Handling Debt After a Divorce
- Stock Watch - What GE's Miss Says About the Economy
- Fund Watch - For a Limited Time Only: A Legendary Manager
- Starting Out - Health Insurance for Twentysomethings
- Value Added - Six Stocks to Buy and Hold
- Cash in Hand - Pipeline to High Income
- Money Smart Kids - What We Learned From My Mother
- Drive Time - Guilt-Free SUV?
- On the Job - Making Work Fun
- More
Here's a twist: The IRS lets some taxpayers deduct expenses they didn't even pay.
This helps you if you bought a home during 2007 and persuaded the seller to pay points charged on your mortgage loan. Until a few years ago, when the seller paid the points, nobody got a deduction. But now, the IRS says buyers usually can pretend they paid the points themselves, and that translates into a valuable write-off.
Because a point is 1% of the mortgage amount, this could save you lot of money. For example, $2,500 of seller-paid points will save you $625 if you're in the 25% income-tax bracket. You'll probably get a break on your state tax return, too.
Also, check to see if the seller paid mortgage interest or property taxes for part of the year that you actually owned the house. If so, you get to deduct those costs on your return -- even if you didn't reimburse the seller.
personaFor more information about deductions for homeowners, see our Taxopedia.
Reprint Article
