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10 Reasons Why Everyone Should Start A Home Based Business
Building a better future and gaining self-fulfillment is a
challenge that faces us all in today's world. We are continually
searching for security and stability in the workplace. Jobs are
lost each day because of corporate downsizing, layoffs,...
Choosing a House Plan for Your Dream Home
Choosing a House Plan for Your Dream Home
First things first, when choosing a house plan you must first
find the land that you will be building on. Not all designs will
look right or even fit on certain lots, so in order to insure
that your...
Faster Home Business Profits
Way too many people believe the Internet is a place to get rich
quick with no effort or sweat needed. You just publish a web
site and poof you have a home business. Please do not hold your
breath waiting on results from an Internet business...
Five Ideas that Kill Home Businesses
There are lots of ways to get off to a bad start with your home
business. As a Home Business Consultant and Coach I've heard the
five listed below most often. Starting off with any of these
common misconceptions can cause you a lot of grief as...
Your Home Business Success Starts With Your Passion
In whatever career you may find yourself in, there is no such
thing as "information overload." Know as much as you can, do
what others do, and what the entire company does. Equip yourself
with a total knowledge of your work environment, enough to...
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Deducting Points On Home Refinances
Any points that you pay in the refinancing of your residence are tax deductible over the length of the loan in question. The deduction is allowable only if the residence is your primary home and the new mortgage replaces a previous one and/or is used to improve the residence. To the extent that money is taken out to pay off credit cards and non-residence costs, the points may not be used as a tax deduction.
Big Deductions By Refinancing Twice
If you refinanced your primary residence twice during 2004, you may be in for a very nice surprise. A significant tax deduction can be created when you refinance twice in one year. If you refinance a mortgage, you accelerate the deductible amount of points from the first mortgage and may claim the points from the first mortgage all at once.
As an example, assume that I refinanced my home in January 2004 and paid $3,000 in points. Interest rates continued to drop through 2004 and I then decided to refinance again in August. Because I paid off the original loan with the refinance, I am
able to accelerate the value of the points of the January loan.
So, what tax deductions have I created for my 2004 filing period? Initially, I am going to deduct a percentage of the points off of my latest refinance. The deduction will amount to the total amount of points paid divided by the total months of the loan. This will not be a big deduction, but every little bit helps.
In addition to this amount, however, I will also deduct the full $3,000 in points that I paid on my January 2004 refinance! I am able to claim this deduction because I "accelerated" the deductibility of the points by paying of January mortgage with the August refinance.
By refinancing twice, I get a lower interest rate and a healthy tax deduction. Ah, the value of owning a home.
About the Author
Richard Chapo is CEO of Business Tax Recovery - Obtaining tax refunds for small businesses by finding
overlooked tax deductions and credits through a free tax return review.
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