How much $ Will I get back at the end of the year If I take my mortgage interest off on my taxes? I just purchased my home in January 2007 and plan on claiming it next year of course and was just curious how much do you usally get back money wise heres my homes details:
Loan Amount: 117,000
Interest Rate: 6.5% Fixed 30 Yr.
Location: Indiana
Thanks for your help :o)
DrewHow much $ Will I get back at the end of the year If I take my mortgage interest off on my taxes?
Most of your payment the first year is interest. Very little is going towards the principal. You're going to be paying about $7500 in interest in the first year. Only about $1300 of that first years payments actually goes toward the principal. (Sucks, doesn't it?) You don't actually get to where you've paid off half of the house until about the 23rd year on a 30 year loan.
However, there is no way of telling you how much that will help your taxes because we don't know what tax bracket you are in.How much $ Will I get back at the end of the year If I take my mortgage interest off on my taxes?
The first answerer was a bit...optimistic.
You can deduct the interest, yes (along with property taxes) but it only makes a difference once you exceed the standard deduction. For couples, that means as much as $10K. So if you had 7K in interest you may not see a difference in your return at all.
However if you itemized THIS year, then you're likely already exceeding the standard deduction, in which case you'd add about 7K worth to that deduction and yes, it would increase your return, but it would still be less than 2K.
For instance, for me, I took the standard this year and basically got a 0 return. Next year I will have added a child (expecting next month) AND nearly 17K in interest-- and my return is only going to be $2500. 1000 of that is the child credit, so my total increase is 1500.
I'm guessing around 7000 in int per yr,deduct that from gross income,about 2000 in your pocket.
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