Real Estate Taxes And Acquiring Tax Lien Properties

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The municipality that governs your property tax, in most instances this is the county, keeps records on your property.  These records include things like lot size, square footage, number of rooms, additions or modifications, and architectural style of the home.  Review this information to be certain its correct.

If you file itemized deductions on your income tax return, you are allowed deductions for property taxes.  You can deduct these taxes whether it is on your primary residence or any other properties you own.  If you own multiple properties this is a good way to lower your tax liability.  There is also no ceiling on how much you can claim in deductions.  Just be sure you are deducting the amount that your taxes actually cost you and do not inflate the numbers on your return, as these tax figures are easy for the Internal Revenue Service to verify.

If you escrow, then your mortgage payment to your lender includes your property taxes.  Your lender is instructed to hold this money for you, in a separate account, and pay it to the tax authority on your behalf when your property taxes come due.  When real estate taxes are escrowed in mortgage payments, you can only claim a deduction with the Internal Revenue Service for the tax year in which they were paid.  The mortgage company or lender will send you an end of year statement that will include all the pertinent property tax information.

Being well informed about these taxes and real estate tax liens can give you a profitability edge when it comes to investing.  You can get very sweet real estate deals if you purchase properties offered up for tax liens.  The amount of money you can save on this type of purchase make these acquisitions so lucrative that it is often difficult to obtain information on property tax lien sales.

Real Estate Agents very often buy real estate at property tax lien auctions and sales themselves and are wan to give out any information about the spectacular bargains you can get on real estate property at these sales.  You do not have to have a real estate license to participate, but the information is usually greedily guarded from the general public.  Still, many real estate tycoons have made, and continue to make, their fortunes by purchasing properties at these sales.  If you have any way to find out about property tax lien sales, pursue them vigorously, but don’t tell anyone else.

When you own a property, you need to pay taxes on it. These taxes are always deductible if on your tax return.  If any property is for sale with a lot of back taxes on if, you can get if very cheaply.


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