*do you currently have a primary
*where you are at on taxes.
*where you are at on your income
*and whether you can buy it with cash or not.
*are you single filer or joint filter
*When you file your taxes, are you getting hit with AMT? I ask because second home deductions that normally don’t get limited with normal tax calculations get limited under AMT rules.
*Also longer term you want to think about when you sell the property. Primary homes have a $250k cap gain exemption ($500k for joint)… It use to be that you could just move to that home and occupy it for 2 years, an then get the full deduction. But government took that away, so now it’s prorated based on how long you live there as a primary.
*Also, putting it in your parents name may have estate taxes issues when the pass away…If you bought it for them, it’s probably considered a gift from your estate… If they die and pass it back to you, it probably gets counted again as their estate subject to estate taxes… Consult a tax attorney…[/quote]
I agree on most of this, particularly the conclusion. Though a qualified CPA will do just as well, if not better than a tax attorney.
I’m pretty sure you’re wrong on the AMT though. Mortgage interest on acquisition debt for a second home is not subject to AMT, within the other general limitations on mortgage debt. Some non-aquisition debt is.[/quote]
I defer to financial people who are experts. I’m just an enginerd that tries to make heads and tails out of a complicated tax law.. I stand corrected. I forget that it’s about the home equity loan that is subject to AMT exclusion…
Duh!
