Real Estate Secrets - How to receive $400 or more take home pay per month...

December 2005

When researching to buy a first home many people are shocked at how much more per month they may be paying for housing compared to their current rent payments. Many times you could be paying $200, $400 and even more than you rent.

But are you really?

It may appear so on paper, but a closer look at the tax benefits of home ownership will show that you could be paying just about the same on a mortgage—compared to what your paying now in rent.

One of the greatest benefits of home ownership is that the mortgage interest and property taxes you pay are tax deductible each year. For example, lets say you purchased a home last year and over the year you paid $12,000 in interest and property taxes. Now lets say your Gross Yearly Income is $50,000. Instead of paying income taxes on $50,000, like you where doing when renting, your now paying income taxes on your adjusted gross income of $38,000 ($50,000– 12,000 = $38,000). The taxes saved can amount to a pretty good chunk of change, normally taken in the form of a tax refund at the end of the year. The above example illustrates a tax savings of approximately $3,360 (refund at year end).

That’s one way to do it.

The other way is to take your deduction each month; thus, your getting your tax refund throughout the year. This way you can help offset some of your new mortgage payment by getting more take-home pay each month. This way, rather than getting a lump sum refund at the end of the year, you take a little bit of your refund each month. Furthermore, your not giving the IRS a temporary loan every year.

Feel free to contact Doug anytime. He is always available, so call him today or apply online, and let him go to work for you!  619-286-9596