my cpa never uses the 1099 that i revceive for my intrest on my mortgage. whats the deal?

Question

she always says that its not enough. does it have to be added to something else to make it more of a deduction??? i dont understand. for the past 3-5 years the amount has been anywhere from 3000.00 to 6500.00. whats up? surley it can be used-seems like a waste to me to pay so much and not be able to use it as a deduction. HELP !!!!!!!!

Answer 1

Depending on your filing status and the amount of the standard deduction he probably determined that it was more beneficial to take the standard deduction rather than itemizing your deductions as it allowed you to lower your taxable income by a larger amount.

Answer 2

There are 2 basic method to claim tax deductions: one is the "standard deduction" (the amount is set by the irs depending on your filing status as single, married,etc) and the other is to "itemize" the expenses, that is, to actually list the expenses that are deductible.
Typically, any professional cpa would choose the method that would give you the higher amount of deduction. So if the standard deducution is higher than all your itemized expenses (including the mortgage interest plus other items such as charitable contributions, interest on student loans, etc) your cpa would be right in choosing "not to use" the mortgage interest because the alternative method will give you a higher tax return.

If you find that by using the mortgage interest (plus other deductible expenses) you would get a higher number, then you should ask the cpa to reconsider. But if the standard deduction is higher, then the cpa has been right.

Follow bellow the value of the standard tax decution according to your file status.

Single $5,150

Married filing a joint tax return or Qualifying widow(er) with dependent child $10,300

Married filing a separate tax return $5,150

Head of Household $7,550

Answer 3

Your CPA should be using the larger amount of either the "standard deduction" or "itemized deductions". In 2007, the Standard deduction is $10,300 if you are married and file jointly, $7,550 for head of household and $5,150 if you're single. Itemized deductions consist mainly of home mortgage interest, state and local income taxes paid, real estate and personal property taxes and charitable giving. You can add the items in the list above to see if you are close to the standard deduction amount, and you can ask your CPA if you think she should give it a second look.

Answer 4

Mortgage interest is an itemized deduction. You only itemize deductions if your total is over the standard deduction for your filing status - that's an amount the government allows you to take without any proof. This year it's $5150 if you are single, and $10,300 if married filing jointly - there are some other numbers for other filing statuses. There are other itemized deductions you can also add to this - read instructions for 1040 schedule A - you can download it at irs.gov

But if your total itemized deductions don't add up to your standard deduction, you'd be cheating yourself by itemizing.

Answer 5

I am a tax prep manager and your question is one of the most common ones that homeowners ask me. the answer is this:

mortgage interest is part of itemized deductions. other examples of itemized deductions are property taxes, medical expenses above 7.5% of your adjusted gross income, contributions to charity and unreimbursed job expenses. the government gives you and option to use the higher of your standard deduction for your filing status or your itemized deductions. if you are married and filing a joint return then your standard deduction this year is $10,300 so your total itemized deductions would have to exceed that amount. if you feel that the total of your itemized deductions is higher in previous years than you can always go back up to 3 years and ammend those returns. it may just be that your cpa didnt want to be bothered with doing an itemized form. there are a few like that out there.

Answer 6

In order to itemize to lower your taxable income on your tax return you will need to go above the standard deduction.

The most common things on the Schedule A to itemize are: State or sales taxes, real estate taxes, mortgage interest, charitable contributions, out-of-pocket medical expenses, and reimbursed job expenses.

You will need to see if all of those things will add up to more than the following standard deductions for your filing status.

Current year standard deductions:

Married Filing Jointly - $10,300
Head of Household - $7550
Single - $5150

Answer 7

You only benefit from itemizing your deductions (mortgage interest, property taxes, state income taxes, etc.) only when the total itemized deductions are greater than the standard deduction for your filing status. Otherwise, what is the use of claiming itemized instead of standard? Sounds like you need to buy a more expensive house.

Answer 8

Chances are you don't have enough deductions to qualify to itemize. If your total deductions are not more than the standard deduction, it is more advantageous for you if your CPA uses the standard deduction rather than using all your itemized deductions. But ask him about it anyway just to make sure, but I'll bet that's the reason.

Answer 9

If your filing status is single ~ you need to come above the standard deduction of $5,150. If your filing status is head of household ~ you need to come above the standard deduction of $7,550. If you are married filing jointly ~ you need to come above the standard deduction of $10,300. This all comes up on a Schedule A and some of the other things that can be included on this form to help you get above the standard amounts are:
~ Medical expenses in excess of 7.5% of your AGI
~State and local income taxes in the year paid
~Real estate taxes
~Charitable contributions

Answer 10

you ought to defiantly itemize as a results of fact you would be over the "usual deduction" quantity. On Sched. A you will document all your loan activity and the valuables taxes paid in 2006. The activity would be pronounced on form 1098. in case you paid the valuables taxes by means of your loan corporation, no longer commonly completed, the valuables taxes will additionally be on form 1098. in maximum cases, you have got a canceled examine as a checklist of the charge. those deductions will help to decrease your tax criminal accountability. the quantity you get lower back will count on your income, withholding, submitting prestige, dependents, different deductions, and so forth...