Archive for the ‘United States’ Category

Are architect or permit fees considered part of “construction costs” for home equity loans?

Posted in United States on 02/27/2011 10:00 pm by admin
Joe asked:


We plan to use a home equity loan to rebuild our studio, putting the loan money in a separate bank account and using that account solely for “construction costs” to ensure the interest remains tax-deductible.

Question 1: We’re paying an architect to design the building and we have to pay the city a permit fee to review and approve the design. Are these two fees considered part of the “construction costs” of a building so we can use the loan to pay these without worrying about the IRS coming after us?

Question 2: Given this scenario, would it be wiser to use a Home Equity Line of Credit so we only borrow what we need when we need it? My concern (as always) is variable interest rates on the lines of credit, so I’d get a lower interest rate today, but it might be higher next year.

Thanks!

Joe

Leon

 

How tax deductible are charitable donations and home equity loans?

Posted in United States on 02/20/2009 05:43 am by admin
djchuang asked:


When they say donations and home equity loans are tax deductible, what does this mean? Does a $1000 donation mean $1000 less federal income tax? Does $1000 paid in interest on a home equity loan mean $1000 less federal income tax?

LUCIANO
 

Took out an equity line of credit, loaned the $ to brother for down-pay on a home. Who gets to claim interest?

Posted in United States on 02/03/2009 01:39 am by admin
melissa m asked:


Brother initially borrowed $92, 000 and then paid us paid the $92,000 plus interest of $8,000 that accrued on the loan to repay our equity loan of $100,000 during 2006. We received a 1098 Form for interest paid credit/deduction. Do we get to claim the $8,000 interest or does he?

ELLIS