I’m a homeowner, and I take the standard deduction, which if I recall correctly was approximately $10,000 last year. It is slightly more than I would get by itemizing, as well as being much less trouble and much less audit-prone.
Of course, I live in a state with no income taxes and have a fixed 5% 15-year mortgage less than 1x my yearly income.
Yes, it stopped me from buying a new house. My current property tax is $6,000 per year and due to AMT I can only claim about $2,700. So I told my wife to say good bye to the new house at the Woods in Eastlake. Over $20k in annual property taxes that would be non-deductable.
My landlord has been in her house since 1947. She regularly calls the city to bug them to trim the palm trees in front of her house and her latest campaign has been to repave the street (she lives in University Heights and honestly, the street is in pretty good shape. The city filled the potholes after the big rains two years ago).
She rails about “I pay property taxes and this is what is due to me” and… her prop taxes are $640 a year. Her property includes a house, four rental units, and two rental garages (she keeps two others for herself). Point taken with the above post about how incredibly skewed property taxes are from lot to lot.
I don’t see my neighbors calling the city to complain about anything, they are too busy working three jobs to get their mortgages paid.
Mello Roos is an assessment and is technically not tax deductible. In the REAL WORLD though, Mello Roos appears on your annual Real Estate bill and is paid at the same time. I dont know anyone that doesnt deduct them nor have I ever heard of any one having a problem deducting them even after IRS audits. To my knowledge, its never been tested legally. So you can basically make reasonable assumptions with them as tax deductible.
my wife and I were looking to buy our first house, but I ran the numbers. after considering the tax “benefit”, we actually come out negative by about $10,000 to $12,000 a year. add to that, we would probably get hit with AMT – we make over $200,000 a year.
we make too much, according to the government, but we can hardly afford a piece of crap condo in south OC!
you can quote me on this: “only the uneducated have and are buying!”
“if people really understood, they wouldn’t have bought!”
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