After the Cliff . . . taxes on your Home

After the Cliff . . . taxes on your Home

One more fiscal cliff was averted . . . so how was real estate affected?

Mortgage Interest Deduction

Not affected.  There was some debate; the Nat’l Association of Realtors made great efforts to remind lawmakers that the MID benefits primarily middle-income families, and any change to it could harm housing and the economy as a whole.

Mortgage Insurance Premiums

If you put less than 20% down when you bought a house, you probably still have a mortgage insurance premium attached to your monthly payment.  They’re still deductible:  if you make less than $110,000 you can take the deduction.

Energy efficiency tax credits

Remain in force.  A 10% tax credit, up to $500, if you make energy efficiency improvements to an existing home is extended through 2013 and made retroactive to cover 2012.

Mortgage cancellation relief

Extended for another year.  Households that have mortgage debt “forgiven” by a lender in 2013 as a result of a foreclosure or short-sale will not have to pay tax on the amount.

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