Quote:
Originally Posted by tvbound
If I give in to the current requests for consulting piling up, the mortgage will help write-off the additional income.
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Yes, but but only getting a 20%-30% reduction in taxes for every interest dollar spent still reduces after tax income by the 80%-70% of interest paid, so the logic is a behavioral emotional response to paying taxes, not a rational plan after tax income maximization approach. A rational after tax maximization income approach is to eliminate all cash expenses, because there is only a tax rate % benefit of additional expenses. - Expense out + tax % savings = cash out of your pocketbook of more than 0 expenses. The only expenses to deduct for income maximization are those required to produce the income. optional mortgage interest is not required in your stated case.
There is never a free lunch for taxes. . and personally, I love paying more taxes because it means that I am wealthier, after all proper after tax income maximization approaches have been applied. . .
sportsguy