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#1
02-03-2005, 06:44 PM
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 Re: Hmmm Seller financed mortgage doesn't figure?? "johnr_526[at]hotmail.com" <johnr_526[at]hotmail.com> wrote: - quote - > My wife owned a condo from before our marriage. Last year, actually in
The interest income you receive goes on Schedule B. The> 2003, she "sold" the property to someone under a land contract. > Meawhile we continue to pay the mortgage on this same property to the > bank. > Seem to me that if we claim the "interest" we're collecting from the > new owner (as a "seller financed mortgage), and deduct the interest we > pay the bank, it should be a wash. But, it isn't. According to > TurboTax, our refund goes down by about $150. > Maybe this makes sense. Can I even deduct this interest, inasmuch as it > isn't our primary residence? We have no other real estate holdings. expense you pay on the underlying mortgage is investment interest and goes first on Form 4952 and then to Schedule A. If your income is otherwise high enough to have the 3% itemized deduction limitation apply, you will lose some of the benefit of itemized deductions, which may explain your lower refund. -- Tom Healy, CPA Boulder, CO Web: http://www.tomhealycpa.com << -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << -------------------------------------------------> |
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02-03-2005, 06:25 PM
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| Re: Hmmm Seller financed mortgage doesn't figure?? "johnr_526[at]hotmail.com" <johnr_526[at]hotmail.com> wrote: - quote - > If anyone can clarify this for me, I'd be grateful.
It's not a qualifying mortgage, it should be treated and> My wife owned a condo from before our marriage. Last year, actually in > 2003, she "sold" the property to someone under a land contract. > Meawhile we continue to pay the mortgage on this same property to the > bank. > Seem to me that if we claim the "interest" we're collecting from the > new owner (as a "seller financed mortgage), and deduct the interest we > pay the bank, it should be a wash. But, it isn't. According to > TurboTax, our refund goes down by about $150. > Maybe this makes sense. Can I even deduct this interest, inasmuch as it > isn't our primary residence? We have no other real estate holdings. deducted as investment interest. Either way, depending on your AGI, the interest is affecting the deduction of your other itemizeds, as investment interest (because it is an investment linked to the mortgage and not real estate), that interest isn't affected by AGI. -- David M. Woods, EA, ChFC, CLU Woods Financial Services Norwood, MA 02062 www.woods-financial.com << -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << -------------------------------------------------> |
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#-1
02-02-2005, 08:38 PM
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| Hmmm Seller financed mortgage doesn't figure?? If anyone can clarify this for me, I'd be grateful. My wife owned a condo from before our marriage. Last year, actually in 2003, she "sold" the property to someone under a land contract. Meawhile we continue to pay the mortgage on this same property to the bank. Seem to me that if we claim the "interest" we're collecting from the new owner (as a "seller financed mortgage), and deduct the interest we pay the bank, it should be a wash. But, it isn't. According to TurboTax, our refund goes down by about $150. Maybe this makes sense. Can I even deduct this interest, inasmuch as it isn't our primary residence? We have no other real estate holdings. TIA & Regards, JohnR << -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << -------------------------------------------------> |
| Tags |
| figure, financed, hmmm, mortgage, seller |
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