Mary Asks… Is there a tax advantage to making my January mortgage payment in December?

Mortgage ToolsYES, by making your January 2014 mortgage payment before this years end, you may in fact save yourself a substantial amount of money. If you were to pay your January 1, 2014 mortgage bill in advance, by the end of December of this year, your interest deduction from January would be shifted to this year’s deductions. This translates into you saving money and receiving a greater tax break for 2013. This should be incredibly appealing if you anticipate that you’ll be in a lower tax bracket next year.

In order to do this properly, you must take into consideration the following information:

◾January is the only month that this tax saving situation will apply

◾Make sure that your payment is received in time for it to count towards this year. Keep in mind that December 31, 2013 is a Tuesday (not to mention New Years Eve) so mailing in your payment a few days earlier or making it on –line would be best to ensure it posts in December.

◾Make a quick phone call to your mortgage company to discuss your intentions. They can also help you assure that this is credited as an interest payment for this year.

◾You MUST be certain that you’ll be in a lower tax bracket next year. Otherwise, you will not be saving much money other than getting and get ahead on your mortgage – which is never a bad thing – just know the facts!

Making your January mortgage payment in advance is a great idea that will save you some money, that is if you fit the criteria above and of course are in a financial situation that allows an additional payment in December!

Meet Cheryl!

About Cheryl

As a successful business owner and community leader, Cheryl Braunschweiger is known and respected for getting things done with a degree of skill and enthusiasm that bring out the best in those around her - colleagues, clients and friends. The name of her business, ALMC Mortgage, reflects Cheryl's philosophy and personality. She says it stands for All Loans Must Close –a reflection of her determination to do whatever it takes to serve her clients. Cheryl has been in the mortgage lending business for 20 years. Read More About Cheryl
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