All Forum Posts by: Danny Shore

how does contributing to a traditional IRA affect an application for a mortgage? Since the contribution lowers Adjusted Gross Income, does it reduce the "income" that would be counted towards paying down a mortgage loan?

thanks everyone. i found a very good answer. Closing costs is an umbrella term for various line items on the HUD-1. Each line item may have a different tax treatment.

This link summarizes it best:
http://www.minassiancpa.com/articles/realestate/closingcosts.html

i did some research and got various conflicting answers. maybe i can get a corroborated answer here (please link the source if possible)

what is the recovery period for the closing costs of a residential rental (1040 Sched E property)?
what is the recovery period for the closing costs of a commercial rental (1040 Sched E SMLLC property)?

http://www.investopedia.com/articles/pf/07/refinancing_mortgage.asp#axzz2H8V7K2FB

I built an amortization table to corroborate his "net worth" numbers but there are 2 conceptual issues I need further elaboration on.

1. Why are the net worth savings based on the beginning of the period principal balances of the loans (i.e. $200,000 instead of $199,753.11)?

2. In the 238th month, why does net worth become negative? Is it because of the higher overall interest paid over the longer loan term?

Well, I am trying to figure why they would tax a buyer who takes out a mortgage and give tax preference to an all-cash buyer.

I am looking at a Mortgage document in NYC's ACRIS system and noticed that NYS taxes the mortgage amount. This is what it states:

Taxes
County (basic): $xxxxx
City (additional): $xxxxx
Spec (additional): $xxxxx
TASF: $xxxxx
MTA: $xxxxx
NYCTA: $xxxxx
Additional MRT: $xxxxx
Total

What is the logic in taxing this one time transaction? In other Mortgage documents, I see that if there is no mortgage taken out, there is none of the taxes above.

I'm looking at a 1098 Mortgage Statement and there is an Interest Paid reconciliation. Here are the 4 lines

Total Interest Applied 2011 $xxx
+ Payments Applied to Previously Deferred Interest $xxx
+ 2011 Interest Applied (Prior Years) $xxx
= 2011 Mortgage Interest Received From Borrower $xxx

The mortgagor refinanced in 2011 tax year.

If a homeowner is in a dire situation where s/he fails to pay the full amount of interest each month (resulting in negative amortization), when s/he applies for a refi, does she have to repay all interest that was due on the first loan before the second loan is given?

assuming a 100% rental property, what are the tax consequences of having an escrow account through which i funnel all the taxes and insurance premiums (as opposed to not using one)?

my best guess is there is no tax benefit. It is the same treatment

"If a portion of your monthly mortgage payment goes into an escrow account, and periodically the lender pays your real estate taxes out of the account to the local government, do not deduct the amount paid into the escrow account. Only deduct the amount actually paid out of the escrow account during the year to the taxing authority."

http://www.irs.gov/taxtopics/tc503.html

no. i just want to know b/c the post does not elaborate on them.