Taxable Income

Dear Mr. Gisriel:I'm thinking about buying a house instead of continuing to rent. Could you briefly summarize the tax advantages of homeownership?Bob MeyerPikesvilleDear Mr. Meyer:Homeownership gives the buyer several major tax benefits that provide a powerful incentive to buy real estate.Owning a home is one tax shelter within reach of most Marylanders, especially if use is made of one of the many first-time homebuyer programs available from private or government sources.L The following are the major tax advantages of homeownership:* Mortgage interest deduction: All interest paid as part of your monthly mortgage payment is deductible from gross income, before you compute your net taxable income.

Dear Mr. Gisriel:I'm thinking about buying a house instead of continuing to rent. Could you briefly summarize the tax advantages of homeownership?Donald ElliottCatonsvilleDear Mr. Elliott:Homeownership gives the buyer several major tax benefits that provide a powerful incentive to buy real estate.Owning a home is one tax shelter within reach of most Marylanders, especially if one of the many first-time homebuyer programs available from private or government sources is used.The following are the major tax advantages of home ownership: Mortgage interest deduction.

WASHINGTON -- The chairmen of President Bush's special tax-advisory panel outlined a controversial plan yesterday to overhaul the nation's tax code by cutting popular tax breaks. The committee would reduce mortgage-interest deductions, treat some health care benefits as taxable income and eliminate the federal deduction of state and local taxes from taxable income. However, with Bush's poll numbers plunging, Republican congressional leaders indicted or under federal investigation and midterm congressional elections next year, it's unclear whether lawmakers will want to risk a public backlash by trimming popular tax breaks.

Q: I'm thinking about buying a house instead of continuing to rent. Could you briefly summarize the tax advantages of homeownership?Thomas DeBlase, OdentonA: Homeownership gives the buyer several major tax benefits that provide a powerful incentive to buy real estate. Owning a home is one tax shelter within reach of most Marylanders, especially if one of the many first-time homebuyer programs available from private or government sources is used.The following are the major tax advantages of home ownership:* 1. Mortgage interest deductionAll interest paid as part of your monthly mortgage payment is deductible from gross income, before you compute your net taxable income.

Q: I'm thinking about buying a house instead of continuing to rent. Could you briefly summarize the tax advantages of homeownership?Bob Meyer, PikesvilleA: Homeownership gives the buyer several major tax benefits that provide a powerful incentive to buy real estate.Owning a home is one tax shelter within reach of most Marylanders, especially if one of the many first-time homebuyer programs available from private or government sources is used.The following are the major tax advantages of home ownership:* Mortgage interest deductionAll interest paid as part of your monthly mortgage payment is deductible from gross income, before you compute your net taxable income.

Members of the Maryland Association of Certified Public Accountants are answering readers' tax questions through April 15.Q. If I cash in a life insurance policy, are the proceeds taxable income? Can I roll it over into an IRA account for tax purposes?A. Proceeds received from the cashing in of a life insurance policy cannot be rolled over into an IRA because your life insurance is a personal asset and not part of a qualified retirement plan. The proceeds are taxable income to the extent the proceeds exceed your basis (cost)

Editor's note: Every Sunday through the end of tax season, The Sun will run an edited transcript of Baltimoresun.com's weekly tax advice column featuring experts from the Sparks accounting firm SC&H Group who will answer reader questions. Submit questions at www.baltimoresun.com/ taxtalk To be eligible to convert IRA contributions to Roth contributions, income must be below $100,000. Should the conversion be removed from Form 1040, Lines 22 and 37 in order to remain below the $100,000 threshold?

A chance remark on a column about year-round tax savings has prompted a few skeptical, if not downright cynical, responses. I mentioned that my wife, Georgina, and I are in the 15 percent tax bracket, the second-lowest (brackets range from 10 percent to 35 percent). Many readers wanted to know how that could be, thinking we are resorting to tax trickery. "Hmm, let's see," began one e-mail. "You and your wife stash away lots in your pension plan and write off many expenses since you are self-employed.

You likely haven't filed your 2007 tax return, but it's not too early to take note of changes for 2008. Capital gains tax will disappear for some, while the youngest investors might be in for a tax shock. Workers will be able to salt away more for retirement. And if your home is being reassessed this year, don't forget to file for Maryland's homestead credit. Stay tuned, too. The emergency stimulus package to prop up the economy could bring on more tax breaks soon. Here are some changes we know about so far: Zero capital gains taxes.

After a number of fiscal scares, Baltimore has reached a turning point. Apparently for the first time in its recorded history, the wealth of the city contributed by its residents has stopped growing.Maryland's largest city is not only declining in terms of absolute population and property tax base but its residents' taxable income also is diminishing. A long-term trend has pointed in this direction for years. A persistent recession has now made this fiscal reality inescapable.While statewide taxable income crept up from $55.4 billion to $56.4 billion between 1990 and 1991, the amount of taxable income earned by city residents fell from $4.86 billion to $4.85 billion, according to new data from the state comptroller's office.