Aug
6
… costs could be as high as thousands of dollars a year (or more).
Fact: Your must pay property taxes on your home each year. Local governments are always trying to raise property taxes.
Fact: Your mortgage company will require you to carry home owner's insurance.
Fact: You'll put a lot of labor into your home or you'll pay someone else to do it.
Fact: If you don't put down 20% of the cost of the house, you'll pay Private Mortgage Insurance (PMI).
Fact: Your house will …
Comment by Jeff: … to paying property tax, maintenance, home insurance, etc.
Aug
4
Track Home Improvment Expenses for Tax Purposes
August 4, 2008 | Leave a Comment
… keep track of your expenses (and receipts ) from home improvement projects? What are the tax consequences?
Taxes
Generally, there are no tax breaks for most home improvement/remodeling projects (excluding those projects that qualify for some type of tax break based on energy savings) in the year that you make the improvements.
From Jackson Hewitt :
The terms repairs and improvements can be confusing as it applies to the value of your home. A repair or maintenance …
Aug
1
Should You Buy a New Car for Better Gas Mileage?
August 1, 2008 | 2 Comments
… It would be pure insanity to trade in a vehicle and assume the costs of a new one (sales tax, dealer profit, etc) just to save on gas.
What If the Cost of Gasoline Doubles?
Let's double either the gas price or the miles driven. That puts me at $150 per month for gasoline. Is a new vehicle worth it at that point?
No. I purchased a new vehicle I would have to pay excise (sales) tax and get it titled (licensed). Excise tax in this state is 3%. If I spent $10,000 it would …
Jul
30
The Real Reason I Paid Off My Mortgage
July 30, 2008 | 14 Comments
… right now, there doesn’t seem to be a short-term low-risk investment that will return an after tax return in excess of most 30-year fixed mortgage interest rates. About a year ago, several online savings accounts were offering 6% APY, and PenFed had a 6.25% CD promotion. Those might have tempted some of the more risk adverse people, as they were probably safer than paying down your mortgage.
Jeff is making a good point here. Interest rates (for investors/savers) are terrible. That …
Comment by Jeff: … get an after tax return of 1.625% on extra money I …
Jul
29
More Reasons to Pay Off Your Mortgage
July 29, 2008 | 4 Comments
… your money work for you compounding at 8-12%, instead of using it to avoid your ~6% mortgage?
2. Tax Benefits
Although trivialized by this blog, the mortgage interest tax deduction is a substantial benefit received by millions of Americans each year. You appear to argue since only 35% of Americans itemized their deduction, that this tax benefit should be completely discounted. This statistic, however, is not persuasive and it provides no insight into the number of homeowners that have …
Comment by Jeff: … return an after tax return in excess of most 30-year …
Jul
28
… . There doesn't seem to be any argument for a mortgage here.
4. The government gives you tax breaks and incentives to do all of this!
Again, an argument for home ownership not mortgage indebtedness. The majority of tax payers either can't or choose not to itemize. According to the Urban Institute, only 35% itemized in 2004.
Also, there are limitations on deductions. So the famed mortgage interest tax deduction is mostly irrelevant here.
The rest of the "tax …
Comment by Jeff: … ~6% mortgage? 2. Tax Benefits Although trivialized by …
Jul
23
… you may be able to include things like a remote starter and other extras.
There may be tax advantages to leasing. Business can deduct the lease costs as expenses. However, businesses can also deduct interest expenses and can use a standard mileage deduction. However you can't use both.
The Decision
I would personally never lease a vehicle. But that's just my opinion. Your situation may vary. Here are some criteria that may affect your decision:
Are you …
Jul
21
How Long Should I Keep Credit Card Statments?
July 21, 2008 | Leave a Comment
… important criteria. Do you use your credit card for business expenses ? Do you have any tax deductible purchases ? If you answered yes to these questions, you'll need to hold onto your credit card statements for 7 to 10 years.
However, if you only use your credit for normal expenses than you'll only want to keep your paper statements for a year at the most. Most Americans can safely shred their credit card statements after a year.
Business Expenses
I suggest you use a …
Jul
11
What Happens to My Stimulus Check If I Move?
July 11, 2008 | 8 Comments
Expecting your stimulus check but you've moved since you've filed your taxes ? There are a few things you need to do to make sure you get your stimulus payment.
According to rumors on the internet, the post office is not supposed to forward mail from the IRS. However I have yet to find an authoritative source that supports this.
If you've moved since filing your return, you should put in a change of address with the post office ? You can change your …
Comment by Chris: … that money as a tax credit on your 2008 taxes. That's …
Jul
9
The Stimulus Payment Was a Ridiculous Political Stunt
July 9, 2008 | 4 Comments
… What about the cost of printing and sending the checks themselves?
The bill itself cost taxpayers $152 billion. However, it just shifted government money from other programs. So in reality there is no net gain to the economy.
In the end, the Economic Stimulus Package of 2008 was a political stunt. An attempt to bribe voters in an election year. I hope voters, especially those that had problems with the stimulus payment, remember this lesson when the politicians try to …