Anonymous wrote:But in places like Florida, you can borrow $200,000 at today's rates and not qualify for the mortgage interest deduction.

I'm not sure what the issue is. Would you rather pay a higher interest rate so you can deduct your mortgage? I'm sure you could find a bank to write you a mortgage with a 9 percent interest rate if you want that.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I did the home office deduction for about 8 years and no audits. But when DD moved into the room, I knew there was no way I could deduct it anymore

Yeah, and when you sell your house, you have to pay the recapture tax on the depreciation, so I hope you kept good records.

please explain PP?

Oversimplified, but:

Say you own your house for 10 years and claim a home office deduction. Say that home office deduction amounts to $10,000 over the 10 years. When you go to sell your home, you have to pay a 25% tax on the $10,000. It's not washed away by the capital gains exclusion, either.

More: http://homebuying.about.com/od/marketfactstrends/qt/SelfEmpResSale.htm

Anonymous wrote:

Anonymous wrote:I did the home office deduction for about 8 years and no audits. But when DD moved into the room, I knew there was no way I could deduct it anymore

Yeah, and when you sell your house, you have to pay the recapture tax on the depreciation, so I hope you kept good records.

please explain PP?

Anonymous wrote:I did the home office deduction for about 8 years and no audits. But when DD moved into the room, I knew there was no way I could deduct it anymore

Yeah, and when you sell your house, you have to pay the recapture tax on the depreciation, so I hope you kept good records.

PP here. It was legitimately used as an office (given the tenor of this thread that might not have been clear!)

I did the home office deduction for about 8 years and no audits. But when DD moved into the room, I knew there was no way I could deduct it anymore

I hope someone who works at the IRS is reading this thread.

Anonymous wrote:

Anonymous wrote:Could I find out the EIN # of a daycare that I don't go to and put that I paid them? It seems the IRS tracks day care expenses more than they do mortgage payments!

Why would you do that? It would be cheating on your taxes.

And it would appear to the IRS that the daycare was hiding unreported income. Crazy idea.

when you use TurboTax at the end it shows you your chances of an audit based on the deductions you claimed. I always make sure I am comfortably in the green zone.

Anonymous wrote:Could I find out the EIN # of a daycare that I don't go to and put that I paid them? It seems the IRS tracks day care expenses more than they do mortgage payments!

Why would you do that? It would be cheating on your taxes.

Could I find out the EIN # of a daycare that I don't go to and put that I paid them? It seems the IRS tracks day care expenses more than they do mortgage payments!