Lake of the Ozarks tax breaks for real estate


Lake of the Ozarks – Tax Benefits of Second Home Ownership

The tax deductions you’re eligible to take for mortgage interest and property taxes greatly increase the financial benefits of second home-ownership and makes Lake of the Ozarks real estate an attractive investment that can be enjoyed by friends and family.  Here’s how it works.

You Purchase:

You have a loan of $150,000 for 30 years, at 7 percent (yes, they are much lower than this right now, but they won’t stay that way forever).  Your payment would be $997.95 per month.  The first payment is made, $122.75 goes to pay down the principal amount of the loan, and $875 is interest paid for that month.   You are allowed to deduct the interest portion of the payment (for this example we will keep the amount of interest paid at $875 for 12 months).

$10,500 = Mortgage interest paid
$  1,200 = Annual property tax

$11,700 = Total deduction

Then, multiply your total deduction by your tax rate.

For example, at a 33 percent tax rate: 11,700 x 0.33 = $3,861

$3,861 = Amount you have lowered your federal income tax (at 33 percent tax rate)

Note: Mortgage interest may not be deductible on loans over $1.1 million. In addition, deductions are decreased when total income reaches a certain level.


Call John Garrett with any questions about Lake of the Ozark real estate.  573-480-6420.

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