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Tax estimating software for year 2016 ??
I've been using TurboTax since it came out from ChipSoft. Of course Intuit bought them out.

Many years ago, I was able to use TTax as a predictive tax program for the next year. It seemed to go stupid on me when i just tried it.

I may be in an unusual tax situation for 2016 where I want to pull a $40k traditional IRA and use it to pay a mortgage that's primarily interest. So, $40k gets added to income; and $40 gets added to schedule A as a mtg interest deduction. Prima facie it would seem to have no tax consequences as the two zero out -- BUT.

Except for the matter of what's the AMT going to do? TTax says it does not come into play; but I cannot rely on that answer.

Anyone know of a software pkg that can run scenarios for tax year 2016?
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I usually just use the prior year's software and set-up a "new" taxpayer name to run what if scenarios. Unless the caps on certain things change or the rates are very different you will have a very good idea of where you will be at. For the instances where the ceilings change you can usually do a pretty easy estimate by hand for that piece.
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I don't know how any of the tax prep programs handle that situation. I have used TaxAct in the past but who knows if it does what you are looking for.

Using FlashAir W-03 SD card in machine. Access through wifi with FlashPAP or Sleep Master utilities.

I wanted to learn Binary so I enrolled in Binary 101. I seemed to have missed the first four courses. Big Grinnie

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Retirement income and AMT are complex issues, and I understand that the software that can deal with this is pretty expensive. Retirement and financial planners have access to it, but don't let them get their hooks in too deep. Since you don't specify your retirement income or other income other than the special withdrawal, then it's not possible to speculate what your liability might be. I just know you won't find your answer in turbo tax. Your bank where you have savings and checking might be able to help you out, but don't be surprised if there is a fee.
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This is going to require a tax attorney. The question becomes whether the 2nd mtg is a qualifying loan under the rules put in place in October 1987. If I enter it as a "qualifying loan", then it works out; but the question remains: Is it a qualifying loan?
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Have you checked out the IRS.gov website to see what it has on this subject? Also, I have a friend who's a tax accountant; if you don't like using the IRS site, I can ask him the question(s).
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I do not know how a mortgage can be interest only. I understand how the payments can be all interest but that does not mean the loan is interest only. If you pay off the balance of the loan, you are not paying off interest but you are paying off the principal and that will allow you to avoid the interest but I would not think that you can write it off as a mortgage interest payment. Just my opinion. I'm no tax expert.

Best Regards,


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Payton: The loan has accrued more interest than principle do to years of deferred payments. The payment would be directed only toward interest.
There would still be interest and principle to take care of after the $40 payment. Mrs Mongo acquired this 2nd mortgage in 1988 to buy her 1st husband out of the house during a divorce. It's owed to her father. She didn't pay on it for years.

In my family, we don't charge interest on loans to close relatives.
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There are such things as Interest Only. It was explained on one web site as:

Quote: The mortgage begins as a five-year adjustable-rate product. Without paying principal, a borrower using, for example, a $300,000 mortgage, would start at 4.125 percent today, the same as a 30-year fixed. Without paying principal, however, the borrower would save $420 per month.

The interest rate can then adjust higher after five years, depending on market rates, but borrowers for this product are underwritten at a rate above 6 percent to ensure they could handle that adjustment. Borrowers are also required to start making principal payments after 10 years; of course they can also refinance the loan whenever they want.

Here are pros/cons of an interest only mortgage.

More affordable during the first few years than a conventional mortgage that charges both interest and principal.

May offer a lower initial monthly payment.

Allows you to spend the money you save in the first few years on other priorities.

Leaves you no better off when the interest-only period expires than if you had rented for five or 10 years.

Eventually requires you to repay the entire principal owing at an accelerated pace, with much higher monthly payments.

You could go upside-down on your mortgage loan, if the house declines in value during the interest-only period of your loan.

Using FlashAir W-03 SD card in machine. Access through wifi with FlashPAP or Sleep Master utilities.

I wanted to learn Binary so I enrolled in Binary 101. I seemed to have missed the first four courses. Big Grinnie

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I know the rules for a 2nd mortgage for tax purposes changed, I think it was 2006.... but I can't recall now..

If you had a vessel, the rules didn't change, just real property on land.

Our tax laws are so complex its impossible to navigate them without a GPS but the maps for that GPS are always out of date.

Hmmm.... just a thought.. but have you contemplated talking with the IRS???? someone there might be able to put a bit of light on the topic for you... just sayin'...
Warning: Eating chocolate may cause your clothes to shrink!
[Image: ry6XtE9.gif] <---- That's ME!
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