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First time house buyers can claim tax relief on their house mortgage interest repayments for the first seven years of their mortgage term.

The tax relief available is provided on a reducing scale. For the first two years of their mortgage repayments, first time buyers can claim tax relief of 25 percent per year.

For the next three years, that is the third, fourth and fifth years of the mortgage, first time buyers are entitled to tax relief at a rate of 22.5 percent per year.

In the final two years of the seven year period, first time buyers are allowed a rate of 20 percent a year.

In January 2009, the amount of interest that is allowed on a mortgage was increased to 20,000 euro for a married couple and 16,000 euro for a single person.

Non first time buyers are allowed tax relief on mortgage interest repayments at a rate of 15 percent per year. This relief period also ends after seven years.

Home mortgage tax relief is given at source (TRS), Mortgage interest relief is given, by your lender, either in the form of a reduced mortgage payment or a credit to your funding account.

A qualifying loan for the purpose of mortgage tax relief is a secured loan, used to purchase, repair, develop or improve your sole or main residence. Mortgage tax relief can also be claimed in respect of the interest charged or paid on main residences or respect of mortgages paid for separated/divorced spouses, and dependent relatives for whom a dependent relative tax credit is being claimed.

Switching to a new mortgage lender or a different mortgage type to achieve a better interest rate is not treated as a new loan by the Revenue. However, moving home and taking out a new mortgage for this home with a new or existing lender is eligible for relief for 7 years from the date of first payment on the new home loan.

As a first-time buyer, it is important to be aware of the fact that a mortgage loan comes with a variety of associated charges and costs. Although currently first time buyers do not have to pay stamp duty, other charges involved include legal fees, buildings insurance, removal costs, land registry fees, lender’s valuation costs and survey fees.

There are two things to bear in mind when applying for a mortgage: what is the percentage of the house value you can receive as a mortgage, possibly up to 92 percent, and what earnings limit will the lender impose, a typical example being three and a half times your salary.

This article is only intended as a basic general summary and you should always seek professional advice where necessary.

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Article Source:http://www.articlesbase.com/mortgage-articles/mortgage-interest-tax-relief-for-first-time-house-buyers-1391186.html

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All You Need To Know About IRS Penalties and Interest

If you have not filed your taxes for a long time or have back taxes, Visit Here http://gov-debt-grantbenefit.blogspot.com

interest and penalties are continuously accumulating. Our office can help you solve this IRS problem.

Failure to file the correct tax forms and paying your tax debt late are punishable by interest and penalties.

Types of Penalties

    * Accuracy – 20% penalty added to your bill for understated income on your return
    * Fraud – 75% for a fraudulently filed tax return
    * Failure to File Penalty. If you filed late you will pay 5% every month up to 25%.
    * Failure to Pay Penalty. If you failed to pay on time you will pay a quarter of a per cent to 1% per month of the amount you failed to pay.
    * Combined – 5% per month for both late filing and payment

The penalties are pretty heavy, as you can see. If you know that you’re going to need more time to prepare your return, file an extension. Your Failure to File Penalty can be eliminated, or at least reduced.

It’s essential to note that if you have a refund coming and file late, there’s no penalty charged since penalties are calculated from the amount that is due.

Interest

If you have tax debt, it is considered as borrowed money from the U.S. government, so interest will be calculated, with penalties. The interest rate formula was set by Congress and adjusted every quarter and compounded daily, ranging from four per cent to 10 per cent per year.

Often the only way to get interest removed from your tax debt is if it was charged as an IRS error. It can happen if:

    * delays in the IRS.
    * an Offer in Compromise will decrease your bill if determined that you won’t be able to pay the tax and interest.
    * tax and penalties were abated, and interest is cancelled.
    * declaring bankruptcy, your last option.Visit Here http://gov-debt-grantbenefit.blogspot.com

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