Last Minute Homeowner Tax Tips from Quicken Loans

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Are you one of the many homeowners who waited until the last few days to file your taxes? Quicken Loans has some last minute tax tips just for you!

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Each year more than two million people overpay their income taxes because they miss simple deductions. Some of the most commonly overlooked tax deductions are those that Uncle Sam provides homeowners. Here are several examples of tax deductions you may be eligible for if you are a homeowner:

Mortgage interest is the most obvious deduction.

•Your primary residence qualifies unless:

  • The mortgage balance exceeds $1 million.
  • You took out a mortgage for reasons other than buying, building or improving your home.
  • Late payment charges or prepayment penalties for paying off your mortgage early may be deducted as home mortgage interest too.
  • Interest on a home equity loan may also be tax-deductible, but the deductible amount is generally limited to the interest paid on your loan up to $100,000.

Property/real estate taxes. These taxes are annual taxes based on the assessed value of your home. Check your mortgage interest statement. It may list the amount of real estate taxes you paid if your taxes and homeowners insurance were placed in an escrow account. If real estate taxes aren’t included, review your cancelled checks to determine the total real estate tax deduction.

Points paid on a mortgage if:

  • The home loan is for your primary residence and it was used to buy, improve or build the home;
  • Paying points (and the amount of points paid) is not an irregular practice in the seller’s geographic area;
  • Points are computed as a percentage of the loan principal;
  • Points are clearly outlined on the buyer’s settlement statement; and
  • The cash you put into your home purchase is at least equal to the points charged.

Additionally, if you refinanced in 2005, you may be able to write off some of the points you paid. Points are deducted proportionately over the life of the new loan. For example, on a 30-year loan, this year and each year thereafter, you can deduct 1/30th of the points paid. However, if you refinanced in 2001, for example, and paid points, you could have deducted 1/30th of those points in each of the 2001-2004 tax years. If you refinanced again in 2005, the remaining points from the 2001 refinance (points not yet deducted) can now be deducted in full since that loan has been paid off.)

Visit Quicken Loans for more homeowner tax tips and a wealth of useful information about home buying and selling, or using your home equity to make home improvements.

Be sure to consult with a reputable tax preparer before claiming any deduction to ensure you are eligible.

About Quicken Loans Inc.

Quicken Loans Inc. is the nation’s largest online home mortgage lender and closed $16 billion in home loans in the 2005 calendar year. The Quicken Loans Web site has been ranked “Best of the Web” by Forbes, Money and PC magazines. Quicken Loans was recognized in 2006 among the top 15 companies on FORTUNE’s “100 Best Companies to Work For” list for the third consecutive year. The company is ranked #1 on COMPUTERWORLD’s “Best Companies to Work in Technology” list. Quicken Loans was founded in 1985 and has more than 3,500 team members.

Contact:

Mike Dunklee

Quicken Loans Inc.

Telephone: 734-805-1061

http://www.quickenloans.com

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Mike Dunklee

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