[lbo-talk] buy v rent/ tax break?

[// ravi]

On Jul 17, 2011, at 9:58 AM, shag carpet bomb wrote:
> OK. So, I'm in the market to buy. What is this deal where I supposedly make back a little money at tax time. In other words, what I've heard is that, if my current rent is $2000/month then with the supposed tax break, if I have a mortgage that is $2000/month, I'm actually paying less per month because of the tax deduction knocking me into a lower tax bracket.
> 

I know only of the simple stuff: your property taxes are deductible for federal tax purposes (state deductibility likely varies by state). Interest paid on mortgage is tax exempt. I might have my exempt vs deductible wrong (and getting that straight will tell us if you will get into a lower tax bracket - which is highly unlikely, I think).

Also, depending on the state, rent might be tax exempt at some % as property tax. In NJ, I think it’s 18%.

	—ravi