Make Your January 1, 2009 Home Mortgage Payment Today to Cut Your 2008 Taxes

[hermione]

This is copied from my blog post today because I'm feeling lazy about re-typing/summarizing:

Make Your January 1, 2009 Home Mortgage Payment Today to Cut Your 2008 Taxes

If you own a home and have not yet made your mortgage payment due on January 1, 2009, do it now before 2008 is over. This could cut the income taxes you will have to pay in April 2009 for you may be able to take a deduction for mortgage interest paid in 2008.

I am not a tax expert and there are some limitations, (i.e. if you deduct your Jan. 2009 mortgage interest from your 2008 taxes, you can’t do it again for 2009, if your 2008 income exceeds a certain amount), but here is a link to an article on MSN Real Estate which might tell you if you would benefit from doing this:

Early year-end mortgage payment could cut taxes

If you pay your mortgage online, do it now as our bank’s website is super slow today, perhaps due to the rush to customers trying to get their payment in before the year ends.

Again, there are limitations; check out the article I linked to and do a little research to see if you can take the deduction.

And do it ASAP before the word day ends. My bank's site was so slow it took almost an hour to submit my payment.

Happy New Year!
Penelope Pince

[khorrell]

Hi Hermione! After I posted a similar suggestion, a reader asked about my logic. I wrote the following post: Thinking It Through about considering your personal situation. There are certainly situations in which it doesn't make sense to pay ahead.

I pay my mortgage early, not for tax reasons but because it makes me feel secure to know that next month's payment is already made. I'm kind of goofy like that, and after so many years of living close to the edge financially I like the feeling of being able to pay my mortgage mid-month the month before.