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Real Estate & Finance News That Affects Your Home                                                     December 2007 - Page 3

 RELOCATION

The Right Move May Give You A Tax Deccuction

If you move to a new home because of a new job or a job transfer, you may qualify for amoving expense deduction. The distance between the old home and the new job must be at least 50 miles more than the distance between the old home and the old job. The location of the new home is not taken into consideration.

Whether a homeowner or renter, you can deduct the cost of moving household goods and the direct cost of moving you and your family. You can also deduct ecpenses for lodging during the move but not meals.

Keep In Mind:  While realty commissions, attorneys' fees and other closing costs are no longer deductible as moving expenses, these costs can reduce capital gains by adding to the home's cost basis or reducing the adjusted sales price.

INVESTMENTS

Know The Rules On Rentals

If you have an adjusted gross income of $100,000 or less (not counting any loss from "passive activities," several adjustments to adjusted gross income or taxable Social Security benefits), you can deduct up to $25,000 in losses from rental real estate against income from other sources.

This is an allowable deduction if you owned at least 10% of the property and "actively participated" in its management. (If you chose the tenants and approved outlays for mainttenance, for example, that's considered "active" participation.) If your adjusted gross income is between $100,000 and $150,000, you can still deduct some or all of your losses from rental real estate, depending on the amount of the losss.

Keep In Mind:  If any rent losses were "suspended" in prior years, they are fully deductible in the year the property is sold.

HOW YOUR HOME CAN SHELTER YOU AND YOUR MONEY Concurrently there are six tax brackets, ranging from 10% to 35% depending upon taxable income amount and filing status. Homeownership is made affordable for many families because of how Uncle Sam's tax deductions result in the federal government contributing 10%, 15%, 25%, 28%, 33%, or 35% toward monthly home mortgage interest and property tax payments! TAXABLE INCOME RANGE SINGLE FLYER           MARRIED/JOINT TAX FLER                  2007 TAX RATE $0 - $7,825                            $0 - $15,650                                                     10% $7,286 - $31,850                   $15,651 - $63,700                                            15% $31,851 - $77,100                 $63,701 - $128,500                                          25% $77,101 - $160,850               $128,501 - $195,850                                        28% $160,851 - $349,700             $195,851 - $349,700                                        33% $$349,701 - or more              $349,701 - or more                                           35%     Keep In Mind:  Many homeowners overpay taxes simply by overlooking deductible items. There are a number of excellent tax preparation books, software and online sources --- including www.IRS.gov -- that can help jog your memory.

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