Private Mortgage Insurance

How long will I have to pay for private mortgage insurance?

It depends. There are generally two ways that private mortgage insurance (PMI) can be removed from your mortgage loan. The first is if you request PMI cancellation directly from your lender. The second is through termination by your lender.

You can request PMI cancellation directly from your lender once you have reached the date when the principal balance of your mortgage is scheduled to fall to 80% of the original value of your home. You can find this date on the PMI disclosure form that was given to you when you first obtained your mortgage. The cancellation request can be made earlier if you have made additional mortgage payments that have reduced your principal balance to 80% at an earlier date. Your lender may also require you to meet certain other criteria in order to cancel your PMI, such as Read More

What is the Net Investment Income Tax

Understanding the Net Investment Income Tax

It’s been around since 2013, but many are still struggling to come to grips with the net investment income tax. The 3.8% tax, which is sometimes referred to as the Medicare surtax on net investment income, affected approximately 3.1 million federal income tax returns for 2013 (the only year for which data is available) to the tune of almost $11.7 billion.1 Here’s what you need to know.

What is it?

The net investment income tax is a 3.8% “extra” tax that applies to certain investment income in addition to any other income tax due. Whether you’re subject to the tax depends on two general factors: the amount of your modified adjusted gross income for the year, and how much net investment income you have.

What income thresholds apply?

Modified adjusted gross income (MAGI) is basically adjusted gross income–the amount that shows up on line … Read More

Who’s Who When Dealing with the IRS.

When dealing with the IRS, it can seem challenging to determine who you are corresponding with and what powers they have. However, for the normal taxpayer, it is remarkably simple. Taxpayers will usually correspond with three different players within the IRS. These include revenue officers, revenue agents and special agents.

Revenue officers help the IRS by collecting taxes that have already been assigned. Their civil responsibility is to collect unpaid taxes before they fall further into arrears. This process often involves calling or meeting with taxpayers directly. If taxpayers do not pay, revenue officers have the ability to file liens and levies against property, wages or bank accounts.

Revenue agents serve the IRS by auditing tax returns. They examine returns for unreported income and to search for deductions that cannot be substantiated by taxpayers. If taxpayers cannot support the numbers which they reported, they will be required to pay the full … Read More