|
Because
of
income
tax
deductions,
the
government
is
basically
subsidizing
your
purchase
of
a
home.
All
of
the
interest
and
property
taxes
you
pay
in
a
given
year
can
be
deducted
from
your
gross
income
to
reduce
your
taxable
income.
For
example,
assume
your
initial
loan
balance
is
$150,000
with
an
interest
rate
of
eight
percent.
During
the
first
year
you
would
pay
$9969.27
in
interest.
If
your
first
payment
is
January
1st,
your
taxable
income
would
be
almost
$10,000
less
–
due
to
the
IRS
interest
rate
deduction.
Property
taxes
are
deductible,
too.
Whatever
property
taxes
you
pay
in
a
given
year
may
also
be
deducted
from
your
gross
income,
lowering
your
tax
obligation. |
