Quote:
Originally Posted by UH1B913
Most of us received a letter in May stating that how much is outstanding of the Bond Payment on our property. It's a 30 yr payment at 6.93%. When we pay our annual assessment there is also an additional "administrative fee" of $45 for the county to pay The Developer. Our home for example had an original bond of about $7000. When you do the math on these payments - one is paying about 7.5% to TD. The letter addressed the statement "Can I deduct the bond assessment on my property tax bill from my income txes at year-end?" The answer was "contact you accountant or financial advisor.....". The Villages with all their knowledge of what's legal for them to do "according to Federal law" knows full well that these are not deductible. It was addressed in the IRS audit again this past year. Now if one has an equity loan available on their home, one can take out the amount to pay off the bond and LEGALLY deduct that from income taxes. I guess from the legal standpoint AND not paying TD 7.5% per year and not being able to negotiate it down - the decision is easy to make.
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Ok if the bond payment (that is collected for the developer by the county by coming on your tax bill) includes interest and principal, I don't understand why the interest portion isn't deductable. Is the interest and principal payment showed broken out. If not I don't see why. I was under the impression that Federal statutes required all reciepients of interest to send a year end breakout of the principal and interest paid,to the payee, so they can deduct the interest portion and don't mistakenly deduct the whole thing.
If this is not being done no wonder the IRS has problems with the developer.
Further if the county is charging an agency fee for collecting the debt for the bond holder(developer), It seems to me you should have the option of paying the bond holder in advance directly and avoid the $45 fee.