“J.K. Lasser’s Homeowner’s Tax Breaks 2006,” by Gerald J. Robinson, Esq. (John Wiley and Sons, Hoboken, N.J.), 2006, $16.95, 217 pages; Available in stock or by special order at local bookstores, public libraries, and www.amazon.com.
Just in time for the 2006 income tax season, the annual edition of “J.K. Lasser’s Homeowner’s Tax Breaks 2006” by Gerald J. Robinson, Esq. hit the bookstores. This annual summary of key tax benefits for homeowners and home sellers provides an excellent reminder of all the tax reasons for owning a house, condominium, or cooperative apartment.
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Author Gerald J. Robinson, a tax attorney, does his best to add a bit of humor to a dull subject. Of course, when saving tax dollars are involved, that can get downright exciting. “Next to being shot at and missed, nothing is so satisfying as avoiding a tax” is one of the quotes from the book.
Rather than being an authoritative tax guide, this book is written for ordinary people instead of for tax experts. But that is its weakness. Many of the explanations and examples are too general and non-specific.
Several times while reading this book I almost yelled at the author “Tell me more” and “At least tell me your source for your statements.” Robinson uses several examples based on tax court decisions, but he fails to tell the reader the name of the case or the citation so we can read the entire decision to see if it applies to our situation.
Instead of being directed to authority sources for his statements, readers must depend on the author’s explanations of the tax results. During an IRS tax audit, this book alone obviously could not be cited by the taxpayer as the basis for claiming a tax break.
The best way to treat this book is as a checklist of possible tax benefits to be claimed. Robinson does a great job of superficially explaining virtually every tax break available to homeowners and home sellers. He even mentions little-known benefits that are easily overlooked.
Some of the charts, especially the one showing when mortgage loan points are deductible, are the best I’ve seen. The chart summary of the complicated casualty loss tax deduction clarifies a difficult topic very well.
Heavy emphasis is placed on how to avoid tax when selling a residence, whether it is your principal residence or a vacation home. Robinson even explains several sophisticated methods of avoiding tax when the home sale capital gain exceeds the $250,000 or $500,000 principal residence sale tax exemption. He also emphasizes how divorced and separated couples can take maximum advantage of this tax break.
However, a weak area involves the author’s explanation of the effect a spouse’s death will have on the home sale tax exemption. But he doesn’t even mention the $500,000 exemption of Internal Revenue Code 121 can be taken by the surviving spouse if the principal residence is sold in the year of the other spouse’s death.
Neither does he relate this situation to the surviving spouse’s stepped-up basis nor why there should be no hurry to sell a home after a spouse’s death. Robinson also fails to mention that in community property states, the surviving spouse can usually obtain a stepped-up basis on the home’s entire market value, rather on just 50 percent as in other states.
If the reader doesn’t know much about how income tax laws affect homeowners and sellers, this book is a great place to start learning because the explanations are very basic and simple. However, for the many readers who know the basics but want to learn more and could benefit from citations to cases and tax laws explained, this book is very disappointing. Brief authoritative citations would have made the book much more valuable.
Chapter topics include: “Deductions in Year You Buy Your Home;” “Recurring Deductions Every Year You Own Your Home;” “Special-Situation Deductions for Homeowners;” “How to Sell Your Home with No Tax on Gain;” “The High-Priced Home: How to Avoid Tax When Gain Exceeds the $250,000 or $500,000 Ceiling;” “When Spouses Split; Little-Known Loopholes Can Provide Big Savings;” “Your Vacation Home is a Tax Shelter;” “How to Get Tax-Free Dollars in Retirement from Your Home;” and “Reducing Estate Tax on Home.”
This is a worthwhile basic book to use as a guide of the key homeowner tax benefits. But it is far from authoritative because the author’s statements are not backed up with citations to his basis for making those remarks. On my scale of one to 10, this disappointing book, which could have been great, rates only an eight.
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