Welcome > Resources > Mortgage Calculators > Determine Tax Savings ...

Mortgage Tax Savings Calculator

Interest paid on a mortgage is tax deductible if you itemize on your on tax return. So are points that are paid to lower your interest rate. Use this calculator to determine how much you could save in income taxes. Click on the "View Report" button to view the results in detail.

Definitions

Mortgage amount

Original or expected balance for your mortgage. Taxpayers can deduct the interest paid on first and second mortgages up to $1,000,000 in mortgage debt (the limit is $500,000 if married and filing separately). Any interest paid on first or second mortgages over this amount is not tax deductible. Home equity loans are limited to $100,000 or the amount of equity you have in your home. Our calculator limits your interest deduction to the interest payment that would be paid on a $1,000,000 mortgage.

Interest rate

Annual interest rate for this mortgage.

Interest rate after taxes

Annual effective interest rate after taxes are taken into account. Please note that in addition to the $1,000,000 mortgage debt limit, this calculator assumes that your itemized deductions will exceed the standard deduction for your income tax filing status. If your itemized deductions don't exceed your standard deduction, the benefit of deducting the interest on your home will be reduced or eliminated. For 2002 the standard deductions were $7,850 for married couples filing jointly, $3,925 for married couples filing separately, $4,700 for singles, and $6,900 for heads of household. You should also be aware that the total tax savings may be less for higher incomes that have their allowable itemized deductions phased out.

Term in years

The number of years over which you will repay this loan. The most common mortgage terms are 15 years and 30 years.

Monthly payment

Monthly principal and interest payment (PI).

Federal tax rate:

The marginal federal tax rate you expect to pay.

State tax rate:

The marginal state tax rate you expect to pay.

Annual Percentage Rate (APR)

A standard calculation used by lenders. It is designed to help borrowers compare different loan options. For example, a loan with a lower stated interest rate may be a bad value if its fees are too high. Likewise, a loan with a higher stated rate with very low fees could be an exceptional value. APR calculations incorporate these fees into a single rate. You can then compare loans with different fees, rates or different terms.

APR after taxes

Annual percentage rate after taxes are taken into account. Unlike your after-tax interest rate, the APR after taxes takes closing costs into account.

Loan origination percent

The percent of your loan charged as a loan origination fee. For example, a 1% fee on a $120,000 loan would cost $1,200.

Discount points

Total number of "points" purchased to reduce your mortgage's interest rate. Each "point" costs 1% of your loan amount. As long as the points paid are not a broker's commission, they are considered tax deductible in the year that they were paid.

Other fees

Any other fees that should be included in the APR calculation. These fees can vary by lender, but at a minimum usually includes prepaid interest.

The mortgage calculators are provided by KJE Computer Solutions, LLC and made available to NUMBER1EXPERT as self-help tools for your independent use and are not intended to provide investment advice. We can't guarantee their applicability or accuracy in regards to your individual circumstances. All examples are hypothetical and are for illustrative purposes. We encourage you to seek personalized advice from qualified professionals regarding all personal finance issues.

"A model of how the Internet can facilitate the process of deciding where to send your children to school" - America's Best School Profiles by The Heritage Foundation Texas Public, Private and Charter Schools: Compare them using these top-rated, comprehensive reports.   Schools in Northeast Tarrant County, Mid-Cities and Keller

Remodeling and Renovations >Water Problems Sometimes there are defects in a house that the homeowners no longer notice, such as small leaks in the roof or a basement that only gets damp when it rains. When the house is on the market, they don't have a real sense of urgency about having such defects repaired. The real estate agent feels quite differently, however. When buyers are deciding which houses deserve serious consideration, any kind of water problem may appear to be much more detrimental than it really is. The sellers may regard a damp basement as simply a sign that it's time to clean the gutters or check the soil buildup around the house or a leaking roof as a call for new flashing. But to someone who has never owned a home, these defects can be taken as signs that the house may not fulfill their primary need for shelter from "the elements." Renters may be perfectly willing to live in a home with minor water problems, but buyers are likely to pass up the same house if they think it won't keep them perfectly dry. See All Tips In The "Remodeling and Renovations" Category > See Complete Library Of Hundreds Of Tips In 30+ Categories >

Q  What group of settlers introduced the log cabin to the New World? A  The Swedish settlers of Delaware brought their own timber for building log cabins, a style that originated in Finland. See More Real Estate Trivia >

Karen Anne Stone RE/MAX Trinity 1600 W. 7th St, # 146 Fort Worth, TX 76107 Direct: (817) 929-3400 Cell: (817) 929-1964 Fax: (817) 571-6890 Email: KarenAnneStone@gmail.com Karen Anne Stone has over twenty years of experience as both a Broker and a Realtor in the residential re-sale market, and also in New Home Sales... having previously worked for several of the area's top new home builders. A former junior high school teacher, Karen uses her unique abilities to assist both Buyers and Sellers with their Real Estate needs. Karen cannot do the impossible, but her clients have occasionally said that at times... she comes pretty close. Please contact Karen for help with all of your Real Estate needs. www.NewHomeHuntersOfTarrantCounty.com is brought to you by Karen Anne Stone NUMBER1EXPERT™ in real estate for Northeast Tarrant County, Mid-Cities and Keller, Texas Read Karen Anne Stone's Privacy Guarantee, Terms of Service, and Free & Without Obligation Pledge

NUMBER1EXPERT™
© Best Image Marketing and/or its clients.
All rights reserved. All information deemed reliable but not guaranteed.