Layout:
Home > looked at houses all afternoon!! Now what...

looked at houses all afternoon!! Now what...

March 14th, 2009 at 06:35 am

This has been an interesting week for me. I spent all of this afternoon looking at 10 houses ranging from 170 (short sale) to 215. I have three favorites. The first one is 215k (asking price) and it is exactly the floor plan I want BUT it has Mello Roos fees of 180 PLUS an HOA fee of 135. That one is off my list as I am not adding 300 to the amount I would pay each month (unless they lowered the price significantly.)

The second house (170k, LARGE lot, parking for RV, and room for pool) might have an offer so we are waiting to see and the third I also love is 200K (great patio and yard, good flooring, great storage cabinets in garage, cherry wood laminate floors) which is just over what I want to pay. Both of these have HOA fees of 65 a month and they take care of the front yard, cutting, watering and all. Sees like a good deal to me.
At 170k I know payments on the house would be just about $1180 at 5% which I think is a good interest rate and closing costs at 6300 or a rate of 5.5% makes my payments 1241 and closing costs about 4700. The second rate means I would pay 178k in interest while the 5% means 156K in interest. I want the 5% rate! And to pay it off faster than that!

I spoke to my tax person this week and with the new tax credit for buying a house in 2009 it would wipe out 90% of what I paid the feds based on 2008 taxes but this year I will make about 9% less with the state reductions in pay. I am playing around with my withholding calculator and trying to determine where my withholding would be for the rest of the year. Where would I move it? 5, 6, 7? At 5 my take home is 3659 or so a month, at 6 it is 3705 and at 7 it is 3750. This year with the 10% reduction in pay I will make 57k. So how do I figure where to place the with holding?

Playing with the with holding means that I pay less federal taxes overall so with this new credit, if I pay less than 8k in takes do I get a complete refund up to 8k? for example, if I pay 7k in taxes to feds (salary, new house items, interest on the house etc.) will I get a refund only up to 7 k or the complete 8k? I know usually it is only on what you have paid but at times there is a complete refund. SO…if I bought a hoseu where do I put the withholding to be sure to maximize the credit but not have to pay anything and get the most from my pay check?

I know I will not get the tax credit from CA because the house is not brand new (stupid in my opinion, give a tax credit that helps the builders more than people??) but I am unclear if there are things I can write off for my California taxes…property taxes? Closing costs?
How in the world do people figure out what to do? Buy a house? Where to put the withholding for the first year? What to write off next year?

Mama! I need your advice and EXPERTISE!



2 Responses to “looked at houses all afternoon!! Now what...”

  1. monkeymama Says:
    1237037542

    Why isn't your tax person helping you with all this? I would ask them, for a start, since they know your tax situation.

    In general, you'd add up the mortgage interest and property taxes, and divide by $3700 to figure out the number of exemptions you have. If you spent $37k on that stuff, you'd have 10 exemptions, in round figures. Nothing else is really deductible.

    If you claim the credit later your tax would probably be $0, but you are required to withhold some taxes, even if you tax liability is $0.

    But I assume you would get the credit with your 2008 tax return. I thought you could amend it for the credit - though I do not know for sure.

    Good Luck! Competition is pretty fierce for starter homes right now.

  2. monkeymama Says:
    1237054502

    I had to add - my offer still stands - if you ever want to meet over lunch or anything to discuss. My time is thin right now though. SO you may have to send me 10 e-mails to get my attention. But, yeah, I am willing to help if I can.

Leave a Reply

(Note: If you were logged in, we could automatically fill in these fields for you.)
*
Will not be published.
   

* Please spell out the number 4.  [ Why? ]

vB Code: You can use these tags: [b] [i] [u] [url] [email]