Did you buy a home last year? Here’s 9 Documents you WILL need when filing your Taxes this year!

1. Mortgage Interest Statement – IRS Form 1098

This allows you to deduct 100% of the mortgage interest you paid in a year – including prepaid interest or points you might have paid at close of escrow. You should have received in the mail a Form 1098 and if you itemize your taxes and claim a mortgage interest deduction, you must include this form with your taxes when you file.



2. Property Tax Statements

You are eligible to deduct the property taxes you pay to your local city, county and/or state. You can’t deduct such items as waste management or local assessments for street lighting, libraries etc., have your property tax statement at hand and make sure you’re only deducting what’s allowed.



3. Uniform Settlement Statement – HUD-1

Right after closing you should have received a form called the HUD-1 Settlement Statement, this form documents a number of items which may help you at tax time including again the prepaid interest, prorated property taxes and closing costs like origination fees and discount points.

If you can’t find a copy contact your escrow company for one.



4. Moving Expense Receipts

These are tax deductible IF you moved at least 50 miles away from your full time workplace, check with your tax preparer for full details.



5. Cancellation of Debt Statement – IRS Form 1099

If you lost a home to foreclosure or short sale you may receive some version of this form from your lender showing income in the amount of the mortgage debt that has been cancelled. This is classified as income and is taxable.



6. Utility Statements for your Home Office

If there is a part of your home you use exclusively and regularly used for business you may be able to deduct some of your home utilities and or repairs, again check with your tax preparer to determine which are legitimate or not.



7. Income and Expense Statements from Rental Properties

If you own rental property your tax situation is a little more complicated, you’ll need to have complete income and expense statements and once again your tax preparer can advise you on correctly ascertaining the depreciation of the property you can claim.



8. Contractor Receipts from Energy Efficient Home Improvements

If you installed any energy efficient improvements – new insulation, dual paned windows and furnaces for example, you may be eligible for a tax credit of 10% of the cost of the upgrades, up to $500 ($200 for the windows).



9. Mortgage Credit Certificate (MCC)

If you bought using a Mortgage Credit Certificate issued by a local housing authority it can apply as long as you live in the home and have a mortgage on it, but they only help defray taxes you actually owe, no good for an actual refund. The deduction is based on a percentage of the mortgage interest you paid, on top of your mortgage interest deduction.



You should always consult a professional tax preparer when you own your home or income property or if you have lost a home due to foreclosure or short sale.

Jane Loveday
DRE # 01439083
Pacific Sothebys International Realty
619-519-1615 Cell
http://janeloveday.com/
http://www.facebook.com/realestatesandiego
http://www.linkedin.com/in/janeloveday
http://www.twitter.com/sdrealestate

5 First-Time Homebuyer Mistakes!

When thinking of purchasing your first home, the primary place to start is contacting a lender to determine how much you can afford. The lender will run your credit report and go through your monthly bills, this is very, very important as most first-time homebuyers are often afraid to get the prequalification, you fear the lender may tell you that you don’t qualify for a mortgage as high as you may want. However this way you’ll make a financial decision rather than an emotional one.



Here are the 4 other things to consider before you start shopping for your mortgage:



If you are thinking of changing your job in a year or two, or may have to move for your job, think twice, ideally picture yourself living in your new home for at least 5 – 7 years.



Make sure you have enough cash/savings to cover closing costs associated with obtaining a new home, including property insurance, taxes, homeowners association dues, any maintenance required immediately, and your new electric and water bills (all usually higher if you are currently renting).



Chose a reliable and reputable Realtor, if you are referred from a friend or family member, ask the agent for references from previous buyers, the same goes for loan officers or mortgage brokers. Often dealing with the actual listing agent, and not your own agent, can pose difficulties as the agents obligations to you may be affected by his/her obligations to the seller also.



Once you have obtained your pre-approval, and taken into account the above, please don’t go our and charge your credit card with major purchases, computers, cars, etc., as your credit score WILL BE RUN AGAIN prior to your loan funding and you definitely don’t want that score to drop even one point.



GOOD LUCK, this IS the time to buy, with interest rates at or BELOW 4%, mortgages are more affordable than ever, and if you are renting, stop paying your Landords’ mortgage and start paying your own!


Jane Loveday
DRE Licence # 01439083
Pacific Sothebys International Realty
619-519-1615 Cell
http://janeloveday.com/
http://www.facebook.com/realestatesandiego
http://www.linkedin.com/janeloveday
http://www.twitter.com/sdrealestate