Real Estate News You Can Use

September 2008

Risé Johns ASR®, CRS®, GRI

 HELP from UNCLE SAM

          The U.S. tax code was first enacted in 1913 and the mortgage interest deduction has been part of the tax policy since its inception.  While this deduction doesn’t cause homeownership, it certainly facilitates homeownership.  A remarkable high percentage of people own their own homes in the U.S in comparison to other countries..

         Some worry that our legislators may take away the deductibility of mortgage interest in the future.  Realistically, homeowners generate more income for the feds than the monies lost.  Homeownership is the backbone of our society.  That, coupled with the strength of the Nat’l Assoc. of Realtors lobby, has ensured that the mortgage interest deduction has not been formally attacked since 1966.

          IRS 936 allows interest to be deducted on loans up to $1,000,000 on homestead and second home mortgages.  You can also deduct $100,000 more in home equity loans.  These figures are based on married tax payers filing jointly and are halved for single taxpayers and married taxpayers filing separately.

          An interest-only mortgage is one way to deduct your entire mortgage payment.  With a regular amortized loan, the amount of your deduction declines  every year.

          One other benefit of homeownership is you can deduct your property taxes.  In fact, if you position yourself correctly, almost all your monthly property costs are deductible.

This is for informational purposes only.  Individual situations vary so be sure to contact your financial advisor when making any decisions.

 Risé Johns has been involved in real estate for over 27 years.  Her knowledge, experience and customer service will make your next real estate transaction a smooth one.  Call Risé at (512) 267-LAGO for “World Class Service.”