| The
tax deductions you can take for mortgage interest and property
taxes greatly increase the financial benefits of home
ownership. Here's how it works.
Assume:
$9,877 = Mortgage interest paid (a loan
of $150,000 for 30 years, at 7 percent, using year-five
interest)
$2,700 =
Property taxes (at 1.5 percent on $180,000 assessed
value
______
$12,577 = Total deduction
$3,521.56 =
Amount you have lowered your federal income tax (at 28 percent
tax rate)
(12,577 X
.28 = $3,521.56)
Note that mortgage interest may not be
deductible on loans over $1.1 million. In addition, deductions
are decreased when total income reaches a certain level.
Next
page |