Wednesday, February 20, 2013

Tax Time and Your Home!

New listing that I just took had purchased their home when one of those tax credits was being utilized by any first time home buyer. There were a couple a few year ago, remember? Incentive income tax 'rewards' to stimulate the housing market.

Now, with a family change, we are selling their home. So, what happens to their tax credit? It was the 8k one that they are now paying back at 500/year on their income taxes. They got the gift/loan, so they have to pay it back.....right?

Quite honestly, I don't know for certain. But, as with most things Real Estate and tax related, accountants defer to us Realtors, and we defer to those Accountants!

Why bring this up if I don't know the answer? Even if I did, I'm never supposed to give tax or legal advice. Says so, right in one of the many pages of documents you sign when selling your home. However, it is important to bring it up as it may affect you when considering the sale of your home.

With that said, if you have questions about that same scenario, talk with your accountant before you talk with me.

As well, remember that us Realtors fought tooth and nail not to have the wonderful home ownership tax benefits taken away from you. Property taxes, interest on your mortgage, and mortgage insurance premiums...all still tax deductions. (check with your accountant for any limits though!)

Be sure to thank your local Realtor when you see me next! 
I have battle scars from that fight!
But, more important, speak with your accountant or tax adviser if you have any concerns about how buying or selling your home will affect your tax situation....before your buy or sell....and, certainly, before April 15th!

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