Posts Tagged ‘Home ownership’
Incentives for Homeownership
The crisis has hampered the sale of housing, but the tax remains an incentive for investment in this asset. However, it is necessary to understand the upcoming changes in deductions and capital gains taxation.
The crisis has hampered the sale of housing, but the tax remains an incentive for investment in this asset. Sellers should know that since January 1, 2010 changes to capital gains taxation on the sale of real estate.
For their part, buyers have to bear in mind that the Government’s intention is to eliminate deductions for primary residence purchases from January 1, 2011 for incomes above EUR 24107.2. They have, therefore, a year to ensure relief to buy a house.
Those who have purchased a home or do so before January 1, 2011 continue to keep the rebate as it applies today. In general, the investment in the acquisition, rehabilitation, construction or expansion of primary residence can deduct 15% of the total contributed a maximum of 9,015 per year, representing a maximum rebate of 1352.28 per year in income tax . This stop includes principal and interest amortized in the case of requesting a mortgage loan.
In case of making a joint income tax return, the deduction base is also 9,015 euros, as the boundaries are established by declaration and not by the declarant. This figure also applies in the case of separated and divorced, they can continue claiming tax relief that was his main residence during their marriage if she continue to live in their children and the other parent.
Among government measures included in the Law of Sustainable Economy emphasizes the reform on the taxation of residence. If finally goes ahead, the financial year 2010 will be the last to buy a house with a right to relief under the current plan. Thus, from January 1, 2011, amended tax deductions for home purchase and eliminated for incomes above EUR 24107.2. Will only have a base of 9,015 deductible for income less than EUR 17700.2. From this amount, the deductions would be reduced linearly until it disappeared in those 24107.2 euros.