Why Buy a Home Now?
As the deadline for having your taxes filed has passed, I’m guessing you once again realize you have paid the government a “Lot of Money”. Not being a Homeowner, your current tax responsibilities can cause a pay raise or annual bonus to simply vanish. After all those extra hours worked to get ahead, I sure you wonder how hard & long must you work to really get ahead? It really doesn’t seem fair.
I can tell you it’s not fair! Homeowners with a mortgage have a very real tax advantage over “Renters”. It’s known as the “Mortgage Interest Deduction”. This tax law has been around since 1913, but even today less than 30% of all tax payers take advantage of this money saving deduction. I have reviewed the tax form IRS Form 936. Their form takes 16 pages to explain this little savings plan. You really need to educate yourself. You might want to ask an accountant or tax lawyer.
The bottom line; if you multiply your annual mortgage interest payments times your tax bracket (maybe 25-28%, and it could be more), the resulting amount is your tax savings.
Example:
$8000.00 (your annual interest payment)
X 25 % (your tax bracket)
_________
$2000.00 (your annual tax savings)
or $ 166.67 (your monthly tax savings would pay a lot of utilities)
_________
$20,000.00 (10 years of this tax savings)
Over a lifetime of mortgage payments, your income tax savings could add up to $ 75,000 – $ 85,000 or much, much more. This tax savings is for homeowners only.
See, you were right all along. “IT REALLY ISN’T FAIR”
With interest rates at historic lows of 4.75 % - 5.00 %,
soft or falling home values,
and a “first time buyer credit” of up to $ 8000.00 for buyers in 2009,
this will be remembered as the best year to buy a home ever.
Please keep me posted on your plans or how I might be of service.
Thank you,
Tim
Tim Taylor ABR, ASP, CRS, CSP, SRES
Real Living HER
Tim@Homes-Columbus.Com
