What To Know About Taxes and Home-Buying

We are one week away from Tax Day! This year, taxes must be filed by April 18th.  Here are 3 things to know about taxes and home-buying:

1.     Planning to buy a house this year? If your income comes from contract work (1099s vs. W2s) then loop in your lender and your accountant before you file. You don’t want to “over-deduct” your income – you may pay less in taxes but your income will be really low and can impact your mortgage qualification. Aim for a balance. 

2.     What to do with your refund? You could use it as your down payment – or maybe you need to reduce your debt-to-income ratio. Ask your lender which choice would be better for your mortgage qualifications. 

3.     As a new homeowner, don’t forget that you may qualify for a mortgage interest deduction on next year’s taxes. Speak to your tax professional about that one.