San Francisco, CA (PRWEB) March 8, 2006
With the almost unprecedented expansion of the Real Estate market in 2005 and the availability of cheap loans, more and more home buyers are facing new tax regulations for the first time. For the thousands of new home buyers this opens up full deductions on mortgage interest. However, the Internal Revenue Service maintains specific home ownership deduction guidelines to determine eligibility. For the 2006 tax season, Internal Revenue Service Publication 530 provides key information for first time home owners.
For many new homeowners, the first smart move would be a change from taking standard tax deductions to making itemized deductions using the standard 1040 form (http://www.irs.com/1040-forms/1040.htm). Key deductions are in the areas of real estate taxes paid to your local tax authority as well as any interest you paid on a home mortgage. In the heated 2005 real estate market, home mortgage interest deductions could be the single most significant amount on your tax return.
On the opposite end of the spectrum, “points” or charges paid by a borrower to obtain a loan are not fully deductible in the year that they are paid. Generally, points must be recognized over the life of a loan, and transfer with any future refinancing. Publication 530 provides a detailed test for determining what may and may not be deducted in the current period.
Often times the myriad rules on what is deductible and what is not deductible can be a bit overwhelming for a new homeowner. To help taxpayers through this often complex exercise, independent tax resource IRS.com has opened up a number of services to guide tax payers through the process. “Whether it’s one of our popular online efile programs all the way to professional tax advice, we can link taxpayers with the full spectrum of services. You can have just the right kind of ‘helping hand’ to take the fear out of filing taxes,” said IRS.com representative, Robert Hoult. IRS.com’s online resources can often cut the tax return filing process by half, and on average tax payers who use efile see tax refunds in their bank accounts 2-3 weeks sooner than they would through paper filing options.
For further information, IRS.com maintains numerous resources for both the individual and business taxpayer. From online e-filing services available on the Internet, to personal tax software all the way to individualized professional tax help, IRS.com can direct you to the appropriate tax resource.