A Guide to Reverse Mortgage Tax Implications
At Citizens Lending Group, we want all of our potential customers to have access to all the information they need to make informed decisions about their reverse mortgage. This page will help individuals to understand reverse mortgage tax implications, one of the lesser known aspects of reverse mortgages. As people go through the process and learn how these loans work, they may think that is all there is to know. It is important to remember that many financial decisions affect your tax situation. Reverse mortgages are no exception to this.
Contact us today to learn more about reverse mortgage tax apply to you.
A Short List of Reverse Mortgage Tax Implications
Many people know that taxes are based, in part, on how much income you earn in a given year. However, many people are also not aware that certain loans and lines of credit can count as income depending on the situation. In the case of reverse mortgage tax implications there are benefits and drawbacks to the impact these loans have on your overall reported income.
Tax Implications for Medicaid Recipients
As you learn all about reverse mortgages you will find out that these loans function similarly to other forms of income you may have. Because of that, they can have an effect on your eligibility for Medicaid. Medicaid eligibility is based on certain levels of income and savings. If your savings or income were to rise while you are on Medicaid you may no longer be eligible for this government program. Depending on how much you borrow with a reverse mortgage, it could raise your income enough to disqualify you. Qualified experts like those at Citizens Lending Group or other reverse mortgage lenders should be able to help you make this determination ahead of time.
It is worth noting, however, that a reverse mortgage does not have an effect on Medicare or Social Security benefits.
Reverse Mortgage Tax Implications that Could Benefit You
Since there are no reverse mortgage tax implications when it comes to Medicare or Social Security. This means that some of your most important retirement benefits are left completely intact no matter how much you borrow. Additionally, you can also use a reverse mortgage to actively lower your overall taxes at the end of the year. Here is how it works.
When you draw more than a certain amount from a retirement account you can face tax penalties. By using a reverse mortgage to access your home equity instead of your retirement assets, you can lower your tax bill by not needing to take as much money from those taxable accounts.
Contact Us Today to Learn More About Reverse Mortgage Tax Implications
Seniors living throughout Florida, Pennsylvania, and California should contact Citizens Lending group with any questions about reverse mortgage tax implications. Our experts will be happy to answer all your questions and help you understand all of the reverse mortgage requirements and tax implications.