Tomorrow is the deadline for filing your federal income
tax return as well as for most state income tax returns.
For those of you who had a home mortgage last year and
other deductions, you might be receiving a hefty tax
refund. Congratulations. Even if you do not get a hefty
tax refund though, the tax benefits of writing off last
year's mortgage interest payments will probably prevent
you from owing more than you would have otherwise. This
is one of the many benefits people have when the own and
finance their homes. It is also good for those people
with investment rental property.
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For those homeowners who might be going through
foreclosure and/or bankruptcy this year, you might not
have the same benefit next year. Every situation is
different, and timing is everything; but consider some
of the tax complications of losing a home to
foreclosure. When next year's tax returns are due, you
may not have enough deductions to reduce your tax
liability - primarily due to not having paid as much
mortgage interest as you did the previous year. This
might leave you owing a significantly larger tax bill
than you have this year.
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Of course, other factors may effect your tax return for
next year. All of these should be considered for next
year including changes in income, changes in deductions
and changes in credits. When you are doing your taxes
this year (April 15th is the filing deadline for federal
individual income tax returns in the U.S.), think about
what will be on your tax return next year and also what
will not be on your tax return next year. Consult with
your tax preparer about your situation so that they can
provide you with an idea about next year and options
which might help you next year. For instance, you might
need to consider changing your withholding amounts with
your employer or maybe making quarterly tax payments.
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Admittedly, the tax laws could change a great deal from
one year to the next; and those changes may or may not
affect your situation; but it is always important to at
least try to prepare.
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Discuss your tax situation with your tax preparer and
with your
legal advisors as well, and let both of them talk
with each other if they think that might be beneficial
to you for this year and the next year.
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