Claim parents as dependents and affordable housing?
My tax advisor said I can claim my parents as dependents since I support over 50% of their living. They also won't be file any taxes since their only income is social collateral. My question is do they obligation to tell their proprietor that they depend on me? They live in a rented apartment offered by affordable housing and I fright if they report this their rent will increase or worse, no longer qualify for affordable housing.Answers: The money that you give your parents for their support is a payment , not sustainable income and therefore is not counted as their income. I can't think it would make any difference to the innkeeper.
Hi,think you will be better stale asking citizens advice.They know the ins & out's of everything.Good Luck
Can anyone explain in plain english what the sub-prime mortgage crisis is all about?
Answers: In an effort to make more money banks relaxed their lending standards. Relaxed lending standards increased demand for mortgages and to get more money to lend they packaged mortgages together into a 'security' for investment banks to buy. This increased the amount of money available for lending and caused another round of standards relaxation.
Unaware or greedy consumers took advantage of the relaxed lending standards and borrowed more than they could afford.
Because they couldn't truly afford the mortgages, they have had difficulty repaying them and let them go into default. To recover their money they have to foreclose on the properties.
In some areas, the majority of loans were unwise because of rapid price appreciation and there areas are really suffering for pricing.
Both lender and borrower share responsibility for this mess.
Mortgage companies extended loans to customers who now claim they can not pay them back.
Many took loans at variable interest rates and when rates increased, so did their payments.
Some borrowed more than they really could afford. Banks have always been willing to let you take the risk. It has always been a borrower beware type situation.
So many people are now unable to pay their mortgages that the banks are short cash. When banks have no cash to lend, the cost of money increases even for good borrowers.
People who couldn't afford to buy a house were given loans anyway. Most of these loans had low payments at first. After a short period of time, these loans "adjusted" so that the payments were too high for some people to pay. Now these people need to sell their homes. The problem is, there are so many people trying to sell that most houses can't be sold for what is owed on them after paying the realtor, closing costs, etc.
Now, what is the answer to the "crisis" in plain English? These people need to lose their homes an go back to renting. Hopefully, this will teach people that they need to save money and buy a home that they can afford on a fixed rate mortgage. Sound harsh? Bail them out and see what happens. We will see even less responsibility from homebuyers in the future.
Sub prime morgages where given to people with bad credit ratings so the payments where high then when the bank of england raised interest payments these people could not afford to keep up there morgage repayments.Hopefully interest rates will keep on falling then these people will not lose there homes.
Is rental propert a right investment if it is break even prior to excise right offs?
this property is located in a resort nouns and rented on a daily or weekly cause. It is manage by the resort and the break even includes these fees.Answers: Yes I would read aloud so. The "real" money in investment property is surrounded by the capital appreciation anyway.
If you can cover your costs for a as expected long time whilst the property is growing in meaning, it means that you are using other people's money really effectively.
Look at it this course. if you have a mortgage on a property. let's utter the property is 100.000EUR worth and you have put 20.000EUR down, you are essentially delivery a return on investment or a "break even" based on 100.000EUR.
Let's utter your costs are 5% but you break even, this is not a cost to you but it means that you income appreciation profit is clean, i.e. adjectives for you.
Let's say that the property go up in utility by 60% by the time you sell it, this is 60% profit on 100.000EUR and not on the 20.000EUR that you initially put down.
This would imply that your profit is 60.000EUR which is three-fold what you invested.
Most buy-to-let properties don't do much more than break even anyway. However, remember that part of your costs (if you own a mortgage on your property) that you are covering are being put final into the property to pay your mortgage rotten (if you have a repayment mortgage) so really you are acceptance profit as you are having to foot back smaller number of your loan once you sell it.
It depends on your other income. If you requirement income form this property, then no.
Otherwise, the export tax right offs can offset other income while the property can be appreciating surrounded by value.
Be sure to enjoy a tax preparer experienced within Schedule E prepare your taxes with this. Keep adjectives records. A loss on rental property can sustain offset your other income.