Friday, March 1, 2013

Financial Friday - Claiming Home Interest Is Not a Good Thing!

There is something I just don't get....  Why do people get excited when they can claim their home loan interest on their tax return?  Am I missing something?  Who gets excited about paying a bank say $10,000 in interest so they can get $2800 back on their taxes (assuming 28% tax bracket)?  Isn't it better to pay so little in interest that you have to take the standard deduction?  That means that you are getting to claim more than you actually wasted in interest on some home loan.
Maybe it's just me, but I get so confused every time I hear someone say something like this...  I will give anyone $2800 in exchange for $10,000 that is willing to do it!  My Uncle Sam has a high cash flow, maybe I can get him to fall for it.

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