Phelix Elsalvador wrote:
- quote -

Your income can meet the qualification limit in either year, if you
close in 2009. Using the cash for home improvements adds to your basis.



- quote -

Hire a professional who offers a guarantee. ;-)

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Agreed.

-Mark Bole

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On Fri, 19 Dec 2008 10:51:40 -0500, Mark Bole wrote:

- quote -

Thanks for the information.

My options are to close on Dec 31 or Jan 2.

I am still investigating the requirements. I think I my income is over
the alloted amount, but I would like to use that cash for home
improvements.

- quote -

I am a renter. No personal property storage.

- quote -

If I did decide to close this year, on Dec 31, I don't think I can be
assessed any property Tax. Well, not a significant amount anyway.
Thanks for clarifying pro-rated property-tax. That is good to know.

I am paying points and I am paying PMI. I took a credit back for closing
costs that was 3 percent of the purchase price. Enough to cover all my
closing costs and to buy down the rate with points. I rolled my PMI
payment back into my rate. Bumping my rate by .5 percent.

If I close this year and itemize there is no PMI payment to consider
since it is rolled into my loan. The points purchased with the credit
back is also negligible since it was not my money. Do I have that
right? How would I make sure that I report it correctly? Am I missing
anything?

Appears that waiting till Jan 2 would be fine.

--
-Phelix

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<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >

Phelix Elsalvador wrote:
- quote -

It's not just an income tax issue. Some states require that
the buyer be living in the home by 31 December to qualify
for homestead/homeowners exemption and other property tax
savings. Talk to your attorney or closing agent, your
buyer's agent, your lender, your tax assessor, etc., to
explore all of the tax benefits and consequences.

http://www.boe.ca.gov/proptaxes/pdf/pub29.pdf

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<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >

Phelix Elsalvador wrote:
- quote -

If you plan to claim the first-time homebuyer tax credit (interest-free
loan up to $7,500), be sure to close before July 1, 2009. You can claim
the credit on either 2008 or 2009 tax return.

As usual, don't let the tax tail wag the financial planning dog. If
your mortgage rate (assuming you are borrowing) is not locked in, it
might get lower if you wait, from all indications. Your current housing
and personal property storage costs, if any, are also an important factor.

Most of the closing costs on your primary residence are not deductible,
but get added to your basis. If you closed today, there would be
pro-rated property tax and mortgage interest for the few remaining days
in the month. This year you can add up to $500 of real property tax
(filing single) to your standard deduction, so you could possibly pay
some of your 2nd-installment (or supplemental) property tax by year end
and still get a benefit. If you are paying points on your mortgage,
they will only be deductible if you itemize, ditto for PMI payments.

-Mark Bole

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<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >

Phelix Elsalvador wrote:
- quote -

Single, your standard deduction is $5450 this year, $5700 next.
If You are borderline, I'd close on Jan 2 which should help you not lose
any deductions this year. I'd also hold off until January to make all of
your generous charitable donations.
Joe

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<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >

My first home purchase.

I am in contract for a home in California and have the option to close
this year or next.

I would like to know if there are any advantages or disadvantages to
closing this year.

My tax position is pretty simple. I have 401K from work that I max out,
I'm single, and I always try an itemize but it ends up that taking the
basic deductions is more advantageous.

If anyone has any thoughts or articles on the web that may be helpful -
please pass them along.

Many Thanks.

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<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >