Part II: The Point of “Points”

This post will be part two of our discussion about points. As noted yesterday, deductible points only occur when you incur debt used to purchase or improve your principal residence. However, what about other points incurred for other reasons such as for refinancing of a loan, buying a second home or buying a rental property? …

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The Point of Points

The Point of “Points” Points paid, either to purchase or improve your principal residence in the year that you pay them, are deductible in the US! There are some key issues that will be discussed over the next two posts. First, the points MUST exceed your down payment or they will be limited to your …

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Determining the Right College for a Student

Many students and parents use college fitness as a determining factor as to what to look for in choosing a college. Here are some of the more important factors that were recommended by experts: 1. Affordability: This includes not only tuition, but fees, supplies, room and board, the net of scholarship. This has to be …

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Bedroom Rentals

For purposes of the mortgage interest deduction, if you rent out part of your principal residence or second home, you may treat the rental portion as your qualifying home if: * The tenant uses the rented portion as a home, * The rented portion lacks separate cooking or toilet facilities, * You rent to less …

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Business Trip Expenses

A friend was on a business trip and stayed with relatives. This lead to a question from that friend. “What can I deduct?” The answer for both Americans and Canadians is that you can deduct any out-of-pocket expenses. Thus, if you pay for food or take the relative out to dinner, you can deduct in …

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15 vs 30 Year Mortgage

15 or 30 year mortgage: Which is Best? Having a 15 year mortgage is VERY enticing. Let’s face it, you avoid 15 years worth of payments! Moreover, it only raises your payments each month by about 50%. However, despite this, you are usually better off taking the 30 year mortgage. WHY? The answer is flexibility! …

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Loan Fees

Here is a tip that I bet most of you didn’t know that could save you thousands. If you didn’t know this, spread the word among your friends: When you buy a home, you can NOT deduct or add to basis any loan costs other than points. Thus, lender required insurance, mortgage title insurance, lender …

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Qualifying Children as Dependents

Question of the week: My son, who graduated from college, lost his job last month and moved back home. Can we deduct him as a dependent? Sound familiar? Answer: You can if you meet the requirements. Generally, a dependent child can’t earn more than the personal exemption amount, which is $3,800 this year in 2012. …

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