Insurance on a home mortage tax deductible???

Question

does this mean all of the interest you pay during the year, you get back or how does this work. excuse the ignorance of the question.

Answer 1

ok, lets cut the bull and all the tech talk and make it plain and simple

first you will get a form after the end of the year from your mortgage company (home loan) that will specifically state the amount you can deduct on your taxes. Notice I say deduct, not refund. This form is "1098" & it will have big bold wording stating its for you tax info or records. Normally there will be dollar amounts in 4 boxes. One of those boxes is for refunded money. Without getting into lots of details the other 3 boxes will be amounts you can typically use on your tax from for a deduction. The IRS instruction books will specificly refer to each box and tell you whats what. Just ask for or get info irs distributes for "Form 1098". It is actually pretty easy step by step stuff they have.

Secondly, the tax advantage everyone tells you home ownership is, is being told to you by people who are either very wealthy or just plain ignorant. You do NOT get the money back and it is ONLY useful as a tax deduction IF AND ONLY IF you itemize. Most of us normal average work for a living people do not have enough stuff to justify itemizing because if you itemize then you lose the ability of taking the standard deduction which is $10,700 if you are married filing together or $5350 if single. If your mortgage interest was over $10K then you are too rich to need to ask us bums.

Thirdly, the amount you can deduct on taxes will decrease each year as you pay less and less interest on your loan so for many it is the first few years that it is of most benefit (again ONLY IF ITEMIZING).

And Finally, please do yourself a favor and do not put all your faith in those shopping mall tax filing companies. Most of the people working there barely know what they are doing, are only following a preplanned format which is NOT unique for your specific situation, and do not really care if they are really saving you money. They just get off on saying "wow, look how much you'll get back" and getting paid and done with you where I can attest that over 50% of the time I have checked peoples past tax forms they actually let uncle sam keep money they should have gotten back. Either take the time to do it yourself (it is NOT as hard as it looks and irs will answer any and all questions without needing your name) or go to a professional surname tax accountant like "slovak and slovak" or "johnson cpa" but realize going to the namebrand places or even using their software is more than often lighting a match to YOUR money. Yesss, even the software. I have for a fact seen different software tax programs (all the so called top ones to buy) on several occasions not only miss opportunities but worse NOT EVEN ADD NUMBERS CORRECTLY!!!!! So there you go, info you won't get anywhere else except maybe from a former IRS employee :-)

Answer 2

PMI (Private Mortage Insurance) is deductible if you closed after 12/31/2006.  Home owners insurance is not deductible.

No, you don't get your mortgage interest back at the end of the year.  How much your actual tax benefit from the mortgage is depends on your tax bracket and what your total itemized deductions are.

Answer 3

No, insurance is NOT deductible, just mortgage interest and real estate taxes.

And they are a deduction, not a credit, so no you don't get the nentire amount back.  Your tax savings is your total itemized deductions, minus the standard deduction for your filing status, times your tax bracket.

So if you had $15,000 in total itemized deductions including your mortgage interest and real estate taxes, and you file a joint return and are in a 15% bracket, your tax savings for 2008 would be  (15,000 - 10,900) times .15, or $615.

Answer 4

NOPE.

Interest paid on your mortgage and your real estate taxes are deductible.  Not your insurance.  Not for home, only for rental property.