Residents in San Diego County can obtain temporary property tax relief if their homes were damaged or destroyed by the recent/on-going fires.

Read more about how to get this temporary tax relief from the Assessor's Office.

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I know this is an unpleasant subject, but now that tax time is approaching (too quickly, in my mind, but there it is), I thought I would take a moment to talk a bit more about taxes as they relate to your relocation. If you moved in 2006, you may have some deductions you can take advantage of when you file April 15 (or before, if you are really on the ball).

Keep in mind that I am NOT a tax expert, and I cannot provide tax advice. For that, I strongly recommend talking to your accountant or CPA. Don't miss out on a deduction that is rightfully yours! By the same token you don't want to try to deduct something that you are not entitled to.

The IRS puts out a pretty good tax guide that I used myself in the past entitled Publication 521: Moving Expenses. It is as readable as all the other tax publications (sarcasm intended).

• You can take a deduction for the cost of moving your household goods (provided you meet the distance requirements)
• And there are some transportation costs (lodging and driving your car to the new location) too. Check on this as I believe there is an allowance for lodging the first night after your stuff is packed and for the first night in your new location
• I understand there is also a deduction that may be allowed for a second car that you drive to your new location. Watch the $ per mile as this seems to change each year and may be different from what it was last year (2005)
• Storage of household goods (there is a limit on the time allowed)

WHAT ARE MELLO ROOS and CAN I DEDUCT THEM ON MY TAXES?

During your search for a new home you will like come across the term MELLO ROOS, noted in the MLS listing, and wonder what this is. Essentially they are fees (in some subdivision) to pay for improvements such as sidewalks, sewers, services, and related items; they do have a lifetime and will expire, but it could be 20 years or more. They are different than HOA fees.

I wanted to keep this post short, but you can read more about Mello Roos here.

A buyer asked me recently if Mello Roos are tax deductible. Tough question - IT DEPENDS. Here is some information that will help with this question.

But the best advice is to check with your Accountant - you don't want a problem with the IRS. And this will likely also be considered by your lender, along with insurance and property taxes when determing what you quality for.

I expect that, like for me, taxes are not your favorite subject.

I got this article a short time ago about 10 new tax laws you should know and wanted to share it. Here is the list, but see the article for more details. And consult your tax professional to find out if and how they impact YOU.

• Telephone tax credit
• Multiple direct deposit option
• Energy-saving home improvements
• Alternative fuel auto credit
• Tougher donation rules
• Older philanthropist rules
• Kiddie tax tightened
• Foreign income adjustments
• Rolling over retirement money
• Old deductions are new again

Take a look. It might save YOU some $$$.

There is some good news for 2007 regarding taxes, for some individuals.

President Bush has signed a bill that mortgage insurance premiums will be tax deductible beginning in 2007.

• The tax deduction is for homeowners and buyers in 2007 (you must purchase OR refinance after January 1, 2007).
• It also covers those households where the adjusted gross income is $100,000 or less.

You can read more about this great savings here.

I recently talked about the value of homeownership on 10/8 on this blog, and just posted a discussion on some of the myths about taxes and homeownership on my First Time Buyer Central blog. You might want to take a look in case any of those issues are pertinent to your situation. Some myths might surprise you!

As always, it is prudent to consult a tax professional regarding your personal situation to avoid any unpleasant surprises (like an audit, or a huge tax bill you could have avoided). Understanding the tax laws is a challenge for sure, and the documents you can find on the IRS site, while helpful, are tough to wade through. A little money spent with a tax professional may save you a bundle. This is especially true if you are relocating since there are other deductions to be aware of (moving expenses, for example).

First, let me say that I am not a tax expert and I cannot advise anyone on the tax implications of relocation, especially if you are using a relocation package from your new or current employer. I can only share what I have learned from my personal experience.

If you are receiving some sort of relocation package, my best advice is to consult your accountant so you will fully understand how your relocation package may be taxed and when. You don't want to be shocked on April 15 when you find out how much more in taxes you owe. You probably should do this before you even accept the relo package in case there are issues that you need to resolve. The money you receive, either directly in the form of a lump sum payment which some employers offer, or a reimbursement for actual expenses, may become part of your overall income and show up on your year-end W-2 in one form or another. You need to know how this money will be treated by your employer (the payroll department can probably help here) and how this may impact your tax return for the following year (chat with your accountant).

There is a good reference on the IRS website about Moving Expenses that I have used in the past, as well as the required form for 1040 filing - Form 3903 for filing expenses/deductions and associated instructions, and Publication 521 on Moving Expenses.

Keep careful records of every expense associated with your move from start to finish in a separate file for tax time, every document you sign, every expense form you complete for your employer of the relocation company (if applicable). Track your mileage carefully. The IRS has a limit on when you can deduct mileage and when not, depending on how far the move is. While there is a deduction for moving household goods (e.g., a receipt from the moving company) there may be limits depending on your situation. There are also IRS restrictions on the costs of transportation to your new home (especially food). Again, records are essential so you can correctly figure your rightful deduction but also be prepared in case of an audit.

Didja know???      Tigers have striped skin, not just striped fur.