2705263
I have about $6k mortgage and $5k property tax, but my federal tax refund remains the same as I only entered $6k mortgage first. It seems that $5k property tax is not considered??
(sorry I forgot to mention, that I used itemised deduction, that also allows for higher amount to be deducted, right?!)
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Also...
1).The added property taxes won't do anything if your state income taxes paid/withheld during 2021 have already exceeded $10,000. That deduction is capped.
2) if you are already getting all your Fed withholding back as a refund (or quarterly estimates paid) from your Federal taxes ...then you don't get any more.....and a gazillion $$ of added itemized deductions won't do anything. (also for the Self-employed....it doesn't reduce SS and Medicare taxes due on your SE gains)
Mortgage interest and property taxes are itemized deductions. The total of All your itemized deductions must be greater than the Standard Deduction for your filing status to have any tax benefit.
Standard deductions for 2021
It depends. You will only see an effect on your refund amount if your itemized deductions are greater than standard deduction. For example, the standard deduction for a single filer is $12,550. This means that your itemized deductions need to be greater then $12,550 for it to have any effect on your refund.
Sorry, I forgot to say. I used itemised deduction.
@AamilD would you please help? Many thanks!
Also...
1).The added property taxes won't do anything if your state income taxes paid/withheld during 2021 have already exceeded $10,000. That deduction is capped.
2) if you are already getting all your Fed withholding back as a refund (or quarterly estimates paid) from your Federal taxes ...then you don't get any more.....and a gazillion $$ of added itemized deductions won't do anything. (also for the Self-employed....it doesn't reduce SS and Medicare taxes due on your SE gains)
Thank you so much for explaining these scenarios!! I never thought State tax would impact on Fed when I only worked on Fed tax return (thus not starting State tax return yet) -- this is really good to know. My state tax withholding does exceed $10,000. I guess Case 2 may be rare? (to get all the Fed withholding back as a refund)
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