Tax time; two words that instill a certain amount of dread in most people. 1040’s, W-2’s, 1099’s become a part of the lexicon of all Americans as they begin the process of gathering their tax documents, receipts, and filling out those all to confusing tax forms. Fortunately for those who have a manufactured home loan there are certain beneficial deductions that should be taken advantage of. |
The tax deduction most people are familiar with is the interest paid on their primary residences mortgage. Of course this is only valid if the balance on the mortgage is less then one million dollars, something most people don’t need to worry about.
To claim this deduction use Schedule A, which is the form for itemizing all your deductions. You can claim all the interest paid on your mortgage from the previous year. You can only claim the interest paid on your primary residence, so keep this in mind if you own other real estate such as rental properties.
Another deduction that most people may not know about is pre-payment penalty deduction. If you paid off your manufactured home mortgage early and had a pre-payment clause in your contract you can deduct those fees on schedule A.
Real estate or property taxes paid to local governments are also able to be deducted. You can find this information in one of two places. If you pay your taxes through an escrow account set up by your mortgage company they will provide you with that information. If you pay your own property taxes your local taxing authority will provide an assessment notice with the amount.
Any points you may have paid during a refinance are also deductible. Points are used to pay down the interest rate on a mortgage and are written off proportionally over the life term of the loan. If your term is for 30 years you get to deduct 1/30th of the points each year that you have the loan. If you refinance your current loan that you paid points on you get to write off all the points of the first loan in their entirety for that tax year.
Points are also fully deductible on a mortgage taken out for a primary residence in which the amount of the down payment is at least equal to the amount you were charged for the points. In this case it is best to consult a tax professional to make sure you meet the necessary requirements.
If you take out an equity loan on your manufactured home you may also deduct any interest paid on that loan as well. There is an exception in this case though; if your mortgage plus the home equity loan is more then the value of your home there are limits to how much you may be able to deduct.
Take advantage of every deduction you can this tax season. There are many tax benefits to having a manufactured home loan so keep some of your hard earned money in your wallet and out of the governments’ hands.
To learn more about manufactured home loans please visit the website Manufactured Home Loans & Refinance by Clicking Here.
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