TAX TIME

Mike M · Jan 29, 2016

I just wanted to double check myself. I know there are a lot of in the know folks on here.
For home mortgage interest to be able to claim it for deduction it would have to exceed your personal exemption because if I remember correctly you can do one or the other but not both. Does this sound right ?

rbhuntn · Jan 29, 2016

(quoted from post at 14:14:47 01/29/16) I just wanted to double check myself. I know there are a lot of in the know folks on here.
For home mortgage interest to be able to claim it for deduction it would have to exceed your personal exemption because if I remember correctly you can do one or the other but not both. Does this sound right ?

That is correct to the best of my knowledge.

Dave H (MI) · Jan 29, 2016

The total of all items on Schedule A, with any and all limitations taken into effect must be more than the standard deduction (not personal exemption). If not, then you take the standard deduction. Special rules apply to special circumstances. Like I tell everyone, email is open if you have a specific question...no charge.

Dave H (MI), CPA

Mike M · Jan 29, 2016

Sounds like I had it correct but have the wrong terminology. I was just wondering if it changed for this year. (wishfull thinking) I didn't want to mess around and enter all my info in turbo tax only not to be able to use it.
Thanks for your offer. I should be fine as mine is VERY simple compared to most. I just hate paying so much more now that my kids are over 18 and not in college. It's not as if I have any more actual money !

K Effective · Jan 29, 2016

Well, Dave MI, what's the secret to getting the most out of college tuition as a deduction? Two working parents, (one grotesquely overpaid) working hard to lose a little on the farm every year (on paper), no mortgage but respectable charitable giving, property taxes, etc to deduct. Both boys earn a little in the Summers, not nearly as much as their tuition (especially the one in Grad school). It seems better to take the dependent deduction for me rather than let them be on their own and able to claim more tuition. Is it just the curse of being semi-successful?

Mark - IN. · Jan 30, 2016

Bingo!

Mark

Dave H (MI) · Jan 30, 2016

You can always run some numbers and see if employing them thru the farm works. They take those earnings and put them against tuition. The net savings of the deduction versus the payroll burden would need to be evaluated. The IRS knows about this type of idea so best be able to document that they actually work and that the compensation is reasonable. I have also had people drop the child as an exemption. We run the numbers both ways. If it works out to be a strong benefit some of these people have the child kick back some money to compensate for the lost exemption. Neither idea works in all situations...just thinking out loud.

TAX TIME

Mike M

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rbhuntn

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Dave H (MI)

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Mike M

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K Effective

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Mark - IN.

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Dave H (MI)

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