8 Real Estate moves before year-end to save taxes

The end of 2006 is almost here, but it’s not too late to cut taxes by putting money in real estate. Here are 8 tax-saving opportunities:

1. Sell a principal residence before the end of the year. If it was owner occupied for at least 24 of the last 60 months before its sale, the sellers can claim up to $250,000 tax-free and $500,000 if they are a married couple filing a joint return.
2. Buy a principal residence before year-end. A typical home acquisition loan fee of 1 or 2 percent of the mortgage amount is tax-deductible as itemized interest. Mortgage interest paid in 2006 is also tax deductible.
3. Refinance a home mortgage and deduct previously nondeductible loan fees. In the year of paying off a mortgage, whether by refinancing or selling, those fees become fully tax-deductible as itemized interest.
4. Get a home equity loan, whose interest is usually fully deductible, and use the money to pay off nondeductible interest from credit card debt or a personal loan.
5. Prepay the January 2007 mortgage payment in 2006.
6. If the local tax collector will allow it, prepay 2007 property taxes and deduct them in 2006.
7. If you moved more than 50 miles and changed jobs, deduct those moving costs.
8. Deduct uninsured casualty or theft loss. Only losses that are more than 10 percent of your 2006 adjusted gross income qualify.