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50 Unbelievable Benefits Of Joint Venture Marketing
50 Unbelievable Benefits Of Joint Venture Marketing copyright @ 2005 Ben Tiew What Is A Joint Venture? A joint venture is an agreement in which two or more businesses work on a project for a set period of time. Joint ventures can be long-term,...

A Singles Game of Real Estate
This discussion leans toward answering questions asked most often by our youthful men and women in there early twenties. They often begin to ask themselves the question, “Should I consider buying a home, condo/town-home or some other type of...

Child and Dependent Care Credit can help you save on your taxes
The cost of raising a child is elevating every day. Paying for baseball leagues, dance lessons, day care, clothing, food and school supplies can add up to be a large sum of money. On the other hand, if you are caring for a parent, a spouse or...

Corporations Failing To Claim Amt Exemption Overpay Taxes By $11,000
Does your incorporated business pay alternative minimum tax [“AMT]? If so, there is a 93% chance you have been overpaying your taxes by an average of $11,000 a year according to the Treasury Inspector General. The Office of the Treasury...

Truly Bizarre Taxes: The Tax on Illegal Drugs
One can never underestimate the enthusiasm that politicians have for trying to hunt up tax revenues. The creativity of some politicians can lead to bizarre taxes and unfortunate results. Taxes on Illegal Drugs One argument for the legalization of...

 
Buy Now, Retire Later-An Investment In Your Dreams

Owning A Second Home Is Easier Than You Think

Buying a second home is a serious financial commitment, but it is can also lead to a feeling of complete freedom. It can provide you with a vacation home, a place to escape from your mundane routine and an investment in the future for when you retire. Aging and wealthier households, smaller families and new technologies that allow professionals to work from remote places are all significant demographic trends. These trends indicate that buying a second home is becoming a more reasonable option for many Americans. The recent changes in tax laws are also making second home purchases more affordable. Strategically planning your purchase, consulting a trusted professional and taking your time are the keys to making the perfect investment.

Strategies For Retirement Investments

Planning for retirement early is smart, especially now. Many experts believe that as the Baby Boomer generation gets closer to retirement property values will increase at a rapid rate. More people will be buying second homes in high demand locations so locking in a lower price now can save thousands. If you are buying a house you want to retire in later be certain to consider all the possible changes and growth for the area. Many times development and increased populations change the face of a seemingly perfect location within just a few years. Another alternative to consider is investing in a home and using it as rental property first. At retirement you can choose to improve and make the rental home your primary residence. You can then sell or exchange and buy the retirement home of your dreams.

Tax Advantages Can Be Found Everywhere

Regardless of the avenue you take to invest in your retirement, the IRS offers tax advantages in a wide variety of ways. Mortgage interest and local and state real estate taxes are all deductible if you live in your second home a portion of the year. Write offs are limited to two homes. If you rent the home for less than 15 days you do not have to claim the rental income or pay taxes on it. If you rent your second home more than 15 days you must report the rental income. However, now all of the expenses used to run the property are deductible. Property taxes, interest, insurance, repairs, utilities, supplies, cleaning and maintenance are all considered


expenses. Equity in your first home can also help with the purchase of a second home as a retirement investment. A home equity loan or line of credit can be used to cover the down payment on a second home. Be aware however, that borrowing in this way only allows the first $100,000 of equity debt to be written off.

Get Creative About Your Investments

Another tax strategy is using the IRS Code, Section 1031. Section 1031 says no gain or loss will be recognized in the exchange of property held for use in an investment. This allows savvy investors to purchase a property and later exchange it for one of like kind. For those planning to retire this means you can purchase a second home as a rental property/vacation home and build your investment. At retirement you can then exchange the property for the dream home you have always hoped for and defer the capital gains tax. The savings is incredible. Of course, real estate deals like this can be tricky so always take advice from a real estate professional and be certain all the transactions are done legally.

On Your Way To The Retirement Plans You Hoped For

Retirement can be a stressful topic for many people. However, more and more middle aged Americans seem to be using forethought and common sense to build the life they know they want to have after 65. Education, creativity, clear thinking, asking questions and knowing the kind of future you want to invest in is the way to achieve success. Using the tax system strategically to reach your goals will lead to a retirement full of joy, comfort and quality time to do what truly matters. When you are ready to search for a second home, or a place to start your retirement, enlist the help of a seasoned REALTOR. One that knows the market of the area you have targeted for your purchase and an SRES or ABR designation after their name. The SRES designation is the most important qualification to help you find the assistance you need. Now that you are ready don’t wait, start making your dreams come true!


About the Author

Elaine VonCannon is a REALTOR with RE/Max Capital in Williamsburg, Virginia, and she manages investment property. Elaine is also an Accredited Buyer's Representative as well as a Senior Real Estate Specialist. She has helped numerous clients invest in and make money on property in Southeastern Virginia.

 

Internal Revenue Service
The US government agency responsible for tax collection and tax law enforcement. Includes income tax forms, instructions, and agency publications.
www.irs.gov
 
Tax Information for Individuals
Access to useful information, booklets and other tools from the Internal Revenue Service.
www.irs.gov
 
Tax Center - Yahoo! Finance - Tax forms, tips and calculators.
Yahoo! Finance: Tax - Find all the resources you need for tax season. Review recent tax law changes, estimate your taxes, find tax tips and expert answers ...
tax.yahoo.com
 
Taxes: Tax Planning, Tools and Advice - MSN Money
Microsoft's Tax Preparation site, in association with Tax Server.
moneycentral.msn.com
 
Tax - Wikipedia, the free encyclopedia
Governments use different kinds of taxes and vary the tax rates: ... Taxes are most often levied as a percentage, called the tax rate, of a certain value, ...
en.wikipedia.org
 
H&R Block | Taxes, Online Tax Preparation, Tax Software, Filing ...
Offers online and in-person tax preparation and tax software, mortgages, brokerage and financial services, consumer tips and tax planning information.
www.hrblock.com
 
TaxCut Online | H&R Block | Online Taxes, File Taxes Online ...
File your Taxes online with TaxCut Online. Learn how to file taxes online here.
www.hrblock.com
 
Income Taxes, Tax Returns, Refunds, Deductions and E-File Software ...
Popular tax preparation software by Intuit. Integrates with Quicken, spreadsheets and offers state by state electronic filing.
turbotax.intuit.com
 
Taxes & Estates, Tax and Estate Planning Advice - Forbes.com
Personal Finance - Get tax and estate planning advice and information from Forbes.com.
www.forbes.com
 
Essential Links to Taxes
TurboTax Premier For Federal Returns 2005 Win/Mac, TurboTax Total Tax Solution Deluxe 2005 with State Win/Mac, TurboTax Basic 2005 Win/Mac... ...
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Government > Taxes in the Yahoo! Directory
Yahoo! reviewed these sites and found them related to Government > Taxes.
dir.yahoo.com
 
Taxes - Tax News for Home and Business from CNNMoney
The latest in tax law updates, news, forms & advice from CNNMoney.com. Includes a refund savings calculator, and interactive tax lessons.
money.cnn.com
 
The Tax Foundation - Educating Taxpayers Since 1937
Devoted to educating taxpayers about tax policy and the total tax burden borne by Americans at all levels of government.
www.taxfoundation.org
 
Welcome to the Vermont Department of Taxes
Welcome to the Vermont Department of Taxes... ... Changes to Property Tax Adjustments in 2007 - updated 10/18. - Tax Expenditures Transition Report on ...
www.state.vt.us
 
Franchise Tax Board Homepage
The department that collects state personal income taxes and bank and corporation taxes for the State of California. Access to forms and tax information.
www.ftb.ca.gov
 
HM Revenue & Customs: Home Page
News and information on tax and national insurance, including downloadable leaflets and forms and the latest news on filing tax returns on-line.
www.hmrc.gov.uk
 
State and Local Tax
Piper Resources; State Tax Rates and Structure ...Federation of Tax Administrators; State Payroll Taxes Information ...Symmetry Software ...
www.taxsites.com
 
Quicken.com
www.quicken.com/taxes/ - 3k - Cached - Similar pages
 
Tax news and advice from Bankrate.com
Information on all phases of tax planning and preparation.
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Online Tax Advice - Tax Preparation Help - Income Tax Tips
Income Tax Tips - MarketWatch offers online tax advice and tips. ... IRS inflation adjustments mean tax break on next year's taxes. ...
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