Tax Breaks for 2016

Tax

The recent 760 billion tax deal that was signed into law in December contained two potentially important tax breaks for homeowners. First was a a retroactive extension of The Mortgage Debt Forgiveness Act through 2016 which expired at the close of 2014. This means loan forgiveness for homeowners who sold their homes for less than the amount of their loan during 2015.

Also retroactively until 2016 was the deduction for mortgage insurance payments, which expired at the end of 2014. This allows homeowners with adjusted gross incomes up to $100,000 can deduct 100% of their mortgage insurance payments with deductions reduced by 10 percent for each additional $1000 of adjusted gross income above $100,000.

Not earth shaking tax breaks but, as they say, every little bit helps.

Partnerships, Taxes & 1031s

“In the midst of tax season, strategies to minimize tax burdens seem to be a priority. Combining partnerships and 1031s are a hot topic and navigating the intricacies involved can be complex.”

“Partnerships (or LLCs) can utilize 1031 Exchanges to defer taxes. A model structure exists when the entire partnership wants to complete a tax deferred exchange. However, when one or more of the individual partners has different investment objectives, a need to strategically cooperate or to dissolve the partnership arises.”

Common Mistakes Homeowners Make on Taxes

Tax

From HouseLogic:

  1. Deducting the wrong year for property taxes
  2. Confusing escrow amount for actual taxes paid
  3. Deducting points paid to refinance
  4. Misjudging the home office tax deduction
  5. Failing to repay the first-time home buyer tax credit
  6. Failing to track home-related expenses
  7. Forgetting to keep track of capital gains
  8. Filing incorrectly for energy tax credits
  9. Claiming too much for the mortgage interest tax deduction

For complete details on each item, please see: HouseLogic.com