With the New Year here and tax season upon us, it's time to talk about your mortgage and year-end information. This includes everything from escrow analysis, property taxes and exemptions. You need to be familiar with these different pieces of information, as well as when the information comes out, each year to stay on top of your financial situation.
Your Year-End Statement directly comes from IHFA and lists amounts applied as interest, taxes, insurance and principal paid on your mortgage balance during the prior year. This statement is mailed in January and should be used for your tax purposes.
The second statement is an Escrow Account Disclosure Statement that details monthly payments into and out of your escrow account. All borrowers pay principal and interest on their mortgage loan plus an escrow amount that IHFA uses, on your behalf, to pay property taxes and insurance on your home. Although IHFA pays these items for you, you may receive tax or insurance bills anyway. In this case, please contact us to ensure that we have a copy for payment purposes.
Property taxes are something all property owners pay to help support the infrastructure of our counties and cities. This includes all the services we use like roads, schools, libraries, parks etc. The Property Tax Reduction (Circuit Breaker) program reduces property taxes for qualified applicants. The amount of reduction is based on total household income for the previous calendar year. If you qualify, the property taxes on your home and up to one acre of land may be reduced by as much as $1,200. Solid waste irrigation or other fees charged in some counties cannot be reduced by property tax reduction benefits. Contact your county assessor's office for more information about this program.
The Idaho Home Owner's Exemption exempts 50percent or $50,000, whichever is less, of a home's assessed value (excluding the land). Taxes are computed on the remaining value. To qualify, applicants must own, occupy and use the dwelling as of January 1. Although there are no income or age restrictions to qualify for the Home Owner's Exemption, taxpayers can qualify for an exemption on only one home.
Contact your local county assessor's office to obtain a copy of the actual statute governing qualification for the Home Owner's Exemption or for a Home Owners Exemption application. When the application is approved, the exemption is permanent as long as one owns and occupies the property. If the property is sold, the new owner must file a new application. Applying immediately will ensure you spend less waiting time in line and provides assurance that all supporting documentation was obtained in time.
Whether it's the Circuit Breaker Program or just property taxes is general, make sure you know about all the issues involved in home ownership. It could impact your wallet in a positive way, and you'll be a better consumer for it.
