Put Your Mortgage to Work for You

It's That (Taxing) Time of Year
Put Your Mortgage to Work for You

It's that time of year again. Not college basketball season, but income tax filing season. If you own a home, make sure you take the time to proactively organize your documents to maximize your tax deductions. Proper planning and organization will help minimize your taxable income.

There are many tax benefits to  Collorado home ownership. The three main deductable items are:

  • Mortgage interest
  • Property taxes
  • Mortgage insurance

Here are some important documents that you'll need handy for preparing your tax returns...and maximizing those deductions! First, make sure to have the Form 1098 that was sent to you by your mortgage company. This will list the mortgage interest and mortgage insurance you paid during the past year. Remember if you refinanced during the past year you will then see multiple Form 1098s, one for each loan.

If you bought or refinanced your home in the past year, you'll also need your Settlement Statement (HUD-1) from your closing. This is important because IRS rules only make a mortgage company send a 1098 for $600 or greater. So if you have interest or deductible fees on your HUD-1 totaling less than $600 you will not be sent a 1098 and will need your HUD-1 as your proof. Finally, don't forget to reference your property tax bills from the past year so you can include the correct amount on your tax returns.

It is estimated that the IRS tax code is currently over 67,000 pages in length – and if you're worried about making a mistake, you're not alone! In fact, in a recent interview on C-SPAN the IRS commissioner Douglas Shulman himself admitted he uses a professional tax preparer. He said, "I use a preparer. I have used one for years. I find it convenient and I find the tax code complex." Yes, that is coming directly from the commissioner of the IRS!

If preparing your return by yourself feels daunting, be sure to contact a professional tax preparer for any help you need. And if I can answer any Real Estate questions for you, please don't hesitate to call or email me.  Brian 303-955-4220

If you know anyone who is looking to buy, sell or refinance a home, please forward their name and telephone number to us. We will happily provide the same high level of service that we have provided to you. The greatest compliment you could possibly give us is the referral of your friends and family.

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