December Homeowner Do's

December Homeowner Do's: Experts say it could help your tax situation to make your January mortgage payment a bit early. Plus, here's a must-do list for the month and a look at which remodeling projects you can squeeze the most value out of as 2013 draws near.
is busy. We get it. But don't get so busy that you forget to do one thing: Consider making your next mortgage payment early.Some borrowers who itemize deductions make their January payment before year's end. "This shifts the interest deduction in those months from next year to this year," explains Jack Guttentag, the Mortgage Professor. "This can be especially advantageous if the borrower expects to be in a lower tax bracket, or expects the tax rate to be lower, next year." (Bing: How low are interest rates right now?)
Here's how it works: You make mortgage payments at the end of each 30-day period you've been in your house or condo. That means that your mortgage bill dated Jan. 1 represents interest for this year — and that means you can put it toward your tax break for 2012.
A few caveats:

• First, you can only do this for January's interest, according to Bankrate.
• Second, make sure your payment will be credited as an interest payment for this year, says Eric Tyson, co-author of "Mortgages for Dummies." "I would strongly recommend that you contact the mortgage company by phone," tell them what you want to do and ask how to do it, Tyson says.
• Third, get your payment in with plenty of time for it to count toward this year. That way, the additional interest will appear on your annual statement, usually a Form 1098 or some federally approved substitute. Remember that Dec. 31 falls on a Monday, and it might even be a good idea to get that payment in before Christmas, just to be safe.
• When is that extra payment not a good idea? "It wouldn't benefit you if you expect to be in a higher tax bracket next year than you are this year," Guttentag says.

So if you have the money, consider scribbling that extra check. You'll be happier come April 15.

contact Joyce Doherty
Pacific Coastal Properties 858-344-3175 for your Real Estate needs, specializing in Solana Beach Real Estate for over 20 years.
 www.pacificcoastalproperties.net

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