Many New Home Buyers Face Tax Regulations

The 2005 real estate boom, coupled with low loan rates, produced a large number of first- time home buyers who will deal with new tax regulations when filling out their 2006 taxes.

Thousands of filers who will deal with deductions can use the Internal Revenue Service (IRS) Publication 530, which is available for the 2006 tax season and provides specific guidelines to determine eligibility for homeowner deductions.

For many new homeowners, the move from standard tax deductions to itemized deductions using the standard Form 1040 would be advantageous. With the hot home market, home mortgage interest may be the most significant amount deducted on the 2006 return. Also deductible are the real estate taxes paid to local authorities.

The charges or points paid by the borrower to obtain the loan are not fully deductible in the year the points are paid, but they are generally recognized over the life of the loan and they transfer with any refinancing in the future. The items that may or may not be deducted at this time can be determined using the detailed test provided in Publication 530.

Many home owners, especially new buyers, can be confused by the rules determining eligible deductions. To guide taxpayers through these often complex tasks, an independent tax resource at www.irs.com has opened some services to help the filer with the process.

This is an independent site and it is not affiliated with the IRS or any state revenue or taxing agency. It provides tax information about IRS forms, state taxes, tax preparation and refunds and 2006 e-file.

"Whether it's one of our popular online efile programs, all the way to professional tax advice, we can link taxpayers with the full spectrum of services," said IRS.com representative Robert Hoult. "You can have just the right kind of 'helping hand' to take the fear out of filing taxes." They state that IRS.com online resources can reduce the return filing process by half and those who choose to e-file receive refunds deposited to their bank accounts, on average, 2-3 weeks faster than those who chose paper filing.

More information about the numerous resources for both individual and business taxpayers can be found at www.IRS.com . Help is available for online e-filing services available on the internet, personal software and individualized professional tax help, as the site is able to direct the user to the appropriate tax resources.

You may like these other stories...

In the old days, we used to tape down receipts from our travels and submit them to accounts payable. But that was before remote employees who may live in a different city from the home office. And of course, there's all...
In 2011, electrical services and technology provider Parsons Electric in Minneapolis, Minn., decided to take its accounting to the cloud. Monica Ross, the company's director of strategic projects, talked with AWEB about...
Event Date: July 24, 2014, 2 pm ET In this presentation Excel expert David Ringstrom, CPA revisits the Excel feature you should be using, but probably aren't. The Table feature offers the ability to both boost the...

Upcoming CPE Webinars

Jul 16
Hand off work to others with finesse and success. Kristen Rampe, CPA will share how to ensure delegated work is properly handled from start to finish in this content-rich one hour webinar.
Jul 17
This webcast will cover the preparation of the statement of cash flows and focus on accounting and disclosure policies for other important issues described below.
Jul 23
We can’t deny a great divide exists between the expectations and workplace needs of Baby Boomers and Millennials. To create thriving organizational performance, we need to shift the way in which we groom future leaders.
Jul 24
In this presentation Excel expert David Ringstrom, CPA revisits the Excel feature you should be using, but probably aren't. The Table feature offers the ability to both boost the integrity of your spreadsheets, but reduce maintenance as well.