Tax Tips 2004 - Real Estate Tax Deductions

As you sit down to deal with your tax forms this year, remember the money saving move you made last year when you refinanced your home mortgage. Real estate expert and author Ilyce Glink says this means you have an opportunity for a big write off - if you paid points the last time your refinanced a few years back.

"Let's say you keep the refinance only five years and at the end of that time you refinance for a lower rate, at that time you may deduct all remaining points that were eligible for the deduction -- the percentage deduction over the years. Whatever is left you can now deduct it all in that year because that is the year you are sort of closing the door on that deal."

Glink says unfortunately, many refinancers completely overlook this tax break, either continuing to amortize old refinancing points or forgetting about them altogether. Glink says for details, see IRS Publication 936.

Not meant to be a complete discussion of any tax subject. We are not responsible for any action taken based on this information, which is from reliable sources and believed to be accurate. See your tax advisor before taking any tax related actions.