Taxes in June?!?!?!

Tax season is over, whew!  So why bring up this subject in June?!?!

Though it will be another 10 months before the looming April deadline rolls around,  it is important to pay attention to laws and changes, so that you can proactively save receipts and know what to expect.

If you have never itemized your taxes, or if this is the first year you will own a home, you may not know what deductions you are eligible for. 

The most common deductions for homeowners in 2013:

·        property tax

·        mortgage interest

·        points paid on a home loan

·        mortgage insurance

·        charitable contributions (cleaning out your closet or garage and donating)

                                                                                            

Don’t forget about the ”fiscal cliff bill” passed in Jan. 2013.  It will allow you credit for energy efficient improvements which include, but are not limited to:

Windows, insulation, a/c, heat pumps, furnaces, water heaters, roofs, and air sealing and duct sealing.  To see if an improvement qualifies check out the IRS website, or these websites below:

Home Heating & Cooling Equipment
http://www.energytaxincentives.org/consumers/heating-cooling.php
Home Shell: Insulation, Windows, Sealing
www.energytaxincentives.org/consumers/insulation_etc.php

Manufactures and retailers should be able to help you figure out whether a specific product qualifies, also.

 Other overlooked deductions are home improvements, or items that add value to your property. 

Though you can’t write off home improvements per say, keeping the receipts and invoices can help when the property is sold so you can offset any gains (calculated by taking your selling price minus original purchase price & provided you have lived in the property for at least three of the five years prior to the sale). 

Before remodeling or making home improvements check out what you can write off at:   http://www.irs.gov/taxtopics/tc701.html

Make sure you consult with your accountant or tax preparer because laws constantly change and are very complex.  They can help you understand how they affect YOU.  But this should help get you started.

If we can be of any assistance to you or someone you know, please contact us.  It is always our goal to make sure you can save money.  Follow me on Twitter @cscheer1961 to stay up-to-date on the latest changes in the market.  We are here to help!

Chris

Goodbye to 3% mortgage rates?

Mortgage rates have seen an increase this month.  In fact, they are at the highest levels since the beginning of April 2012.  With interest rates increasing by about 1/2% within the last few weeks. 

1/2% may not sound like much, but analysts have said rising mortgage rates could spur some homebuyers who have been sitting on the fence to make up their minds to buy . 

So does this mean you should rush your home search, or increase your urgency to refinance?  Rushing to a decision isn’t the answer, but being proactive and strategic is.  Here is why you don’t want to put it off: According to the Mortgage Bankers Association, by the end of 2013, the interest rate on a 30-year fixed mortgage will be at 4.4 percent. And by the end of 2014, they see the rate reaching 4.6 percent.  If you are looking to buy, it is important to get pre-approved at today’s most competitive mortgage rates. 

Consider this:
Earlier this year Yahoo! Homes took a historical look at interest rates.  They evaluated the difference between the cost of borrowing money today, as opposed to in 1981.They compared a 30-year, $300,000 fixed-rate mortgage with a 1981 rate of 18.45 percent to one with a February 2013 rate of 3.51.*

 

	1981 Mortgage	Feb 2013 Mortgage
Loan Amount:	$300,000	$300,000
Interest Rate:	18.45 percent	3.51 percent*
Monthly Payment:	$4,631.56	$1,348.81
Interest Over Life of Loan:	$1,367,362.81	$185,571.33

 Even though interests rates have crept up since February of 2013, you can see, we are not in the same boat as we were in the past.  In 1981, your monthly payment would have been almost four times as much!  To see the full article, click on the link at the bottom.

Continue to follow my Blog or find me on Twitter to stay connected and informed.  And please, don’t hesitate to contact me if you have any questions!

Chris

*According to the "Weekly Primary Mortgage Market Survey®" by Freddie Mac

http://homes.yahoo.com/news/low-mortgage-rates-013524692.html