What if one spouse has contributed to the downpayment?
Suppose the wife has made an initial down payment of $70,000, and the home is about to be sold. In the sale, the parties want it to come out that she would take out $70,000 more than he would. Responsibility for the mortgage, however, is being shared 50-50. What you can do is to create […]
How are real estate sale proceeds reflected in the software?
: When a home is sold, the proceeds show up on the Net Worth and Summary Totals spreadsheets, but not in the Budget Report or cash flow spreadsheets. Otherwise, the large income number would distort the cash flow picture in the year of sale. When you look at the Net Worth or Summary Totals spreadsheet, […]
How do I enter a home sale being used to fund a downpayment?
When a home is sold it shows up only on the Net Worth spreadsheet. (Otherwise, the large number would distort the cash flow picture.)When you look at the Net Worth spreadsheet, you will see an asset shifting from the Real Estate Property column into the Accumulated Savings column.Also, of course, if there are federal taxes […]
Should I enter a real estate investment property as Real Estate or Cash & Investment?
You may choose based on the level of detail you wish to enter. If the real estate is more of a passive investment, where it is enough to enter net value and rate of return (or dollar amount of return), then Cash & Investments would be fine. Use the Real Estate screen if you wish […]
How do I enter responsibility for the mortgage shifting from one party to the other?
Here is how to specify that Party A is taking the mortgage over from Party B after, for example, four years: 1. Set Party B as initially paying the mortgage. 2. On the “more info” screen for the mortgage, specify that Party B will make a balloon payment in the amount of the balance at […]
Is the tax shown on the Sale of Real Estate report exactly correct?
The tax shown on the Sale of Real Estate Report is an estimate. The software takes the current marginal tax bracket and applies that to the total amount of the gain. This will not be correct if the gain straddles two tax brackets. The View/Edit Taxes report, showing the actual tax, will be correct. The […]
How can I more precisely account for the tax on sale of real estate?
The Sale of Real Estate Report shows an estimated tax amount. But this is only a rough estimate, made by applying a marginal capital gains tax rate to the taxable gain. It will not reflect a situation where the gain causes a change in tax bracket, or the impact of the alternative minimum tax, or […]
Why are the mortgage (and other expenses) not showing up on the financial affidavit or Budget Report?
Most likely, the reason is that the property has been indicated to be a rental income property. You can see this by looking on the "more info" screen for the real estate property, and see if the question shown below is answered "Yes." In this case, by default, 100% of the mortgage is subtracted from […]
How do I enter rent for a party who is paying rent?
Question: How do I enter rent for a party who is paying rent? Client Info > Income & Expenses > Real Estate Expenses > Add tenant expenses.
Can a party who does not live in the marital residence claim the mortgage deduction for it?
In general, a party must live in a residence in order to claim the mortgage deduction for it. For more information, see IRS publications 504 and 936. In Publication 936, search for the definition of "qualified home." An exception may apply if the title is in joint names and the payer is obligated to pay […]