The bank uploaded their 1099 for 2024.  We paid $15682 in mortgage interest last year.  That works out to renting out place at $1306.83/month.  Of course our property taxes were $13014 for the year. I paid $1409 for the year.  All in all to rent our house monthly?  $2508.75/month.  Pretty sweet.  We are currently paying $1836/month in principal so our payment is hefty but that's an enforced savings of almost $2k/month to live in our house.  

When we moved in 2015 we were renting our first ever single family home at that time I believe for $2500/month.  That was less than the PITI on our old condo which was $2250/month plus HOA!  Of course that included principal so not a fair comparison.  It broke down to $851 interest/month + $545/month taxes = $1396 interest and property taxes.  Then add in HOA and insurance I believe we were at $250/month HOA and $25/month insurance $1671/month rent.  But with principal we were paying more than renting.

But our prior placed we lived from 2005-2015.  Our current place we moved in 2017 and are still here.  We now pay too little in mortgage interest to itemize.  

But I want to point out to people who say renting in HCOLA have obviously never really broken down the numbers.  I guarantee you that there is no way they ever do the actual math.  Why?  Mostly because when you are renting you need to be saving the difference in payment and investing it.  You also need to be saving more to get the down payment along with not building appreciation.

The rental we had in 2015-2017?  Now rents 10 years later for $4000/month. I checked on zillow and saw a house for rent listed currently.  So I would be renting now for $1500/more than I renting my house for.  To rent my house which is in a better location than where I rented?  I rented in a good neighborhood to save money, but location was lower tier.  We picked A tier to buy because we wanted the shortest commute possible.  To me that's how you compromise.  Rent less and buy best.  To rent my house now?  Rental in our neighborhood for the size of home (smallest) is $5k.  Most are starting at $7k -$10k because the homes are larger.  

I plan on teaching the kids, buy as soon as you are stable.  I hope to help them in fact and perhaps even encourage buying a 2 bed and renting out a room. Housing is a hedge against inflation.  But something people fail to realize is that as you get older and pay off your home the amount of money needed to live there will be our property taxes, insurance, and maintenance.  To be paying $5k/month or $60k/year rent right now for our house means in the 8 years since we've bought the renter should have been saving the difference and invested it to pay for the increased cost they will be paying moving forward.  

And this is for a home on the west coast.  I can't imagine that in cheaper places it makes sense to rent forever.

Even after nearly a decade of doing taxes i am shocked and surprised by how people spend money.  I get spending money. I understand that no matter what you make you want more. I am not surprised that many people are in debt and they live a lifestyle above their means.  To me that means typically using a CC to supplement a lifestyle that is unaffordable.  But this year more people than ever were unable to pay their IRS tax bill.

All of the families/couples earned above $100k.  2 earned above $150k closer to $200k and the other 2 families earned about $120-130k.  Yes we live in an expensive area and it's hard to live.  But honestly there are famillies living on less.  It's that all these families have made a choice to not pay their tax bill because they deliberately are unwithholding and then shocked when it comes back to bite them.

Couple 1 added another $8k to their already owed back taxes bringing them to almost $30k on a payment plan. I did tell them after $50k the IRS would probably deny the payment plan and potentially start garnishing their wages.  They didn't seem at all concerned. I wanted to shake them and say you realize that the IRS doesn't go away with bankruptcy?  I did suggest putting it on a CC but they didn't have enough space to charge their debt and still live.  What they drive?  A lexus.  This is a point where a beater would probably be better to give them extra money to pay the irs.  I mean technically they are not spending their money but the governments.

Couple 2 same thing.  They couldn't afford to pay their $5k tax bill. They were shocked.  But half of the couple a guy earning $70k paid $3k in federal income taxes.  They were stunned when i pointed out that's maybe why they owed $5k.  They figured the money they took home every month was theirs.  They were used to having $2-3k/week coming in because their biweekly paychecks were on opposite weeks. They have been bringing home $10k month and had no savings to pay for their tax bill.  They drove a bmw.  Of course both cars could have been old and cheap but I'm guessing a $5k beater is cheaper to pay off the IRS.

IRS debt doesn't go away with bankruptcy and it's hard to wait 10 years for it to be forgiven. In fact bankruptcy can extend the 10 year forgiveness for IRS debt.

The other two couples, one woman she didn't pay her irs bill from 2019 and the fees and interest had snowballed like a credit card making it next to impossible for her to pay off.  I do feel bad for her but at the same time she too isnt' withholding enough when she owes every year.

The final couple well everything did them in.  While they owed the irs $20k, I had to suggest talking to a bankruptcy lawyer.  They owed $100k on credit cards, $50k in medical bills from a recent ankle surgery where they didn't have health insurance.  Even making $120-150k I'm not sure they can get out from under all that debt.  

I don't understand how people see their money coming in and set it aside or have it withheld.  I mean i get one time things that happen an inheritance, gift, bonus.  But knowingly not paying enough taxes so you have more money to spend every month is crazy.  The money isn't yours it's the government and the IRS is not a fun thing to deal with.

Well I got to see how they raised our property taxes. I flipped out last summer when the assessed value of our home went up 75% in one year.  I had a conniption.  DH said someone posted on our Facebook Be Neighborly group from the city council and he said we would have no raise in property taxes.  Everyone's assessement was increased and this would mean we all have the same share of taxes so it wouldn't change.  Well that was a blatent lie.  Either way I am just annoyed at it.  It went from $11k to about $15k a year.  That is a hefty chunk of change.

We also decided to push back macchu picchu until summer 2024.  That meant we had no real plans for the summer.  So I began to think about what to do.  DH wanted to minimize his vacation days (he'll have used 1 by august, but he gets 15 a year), and gets a 4 day weekend labor day so 4 days going somewhere the last week of August.  I figured no more than a 6 hour flight.  That put us on the east coast at most.  So I picked florida and WDW.  I read that a lot of schools are back in session, the season is getting lower and while it's hot, it's not any worse than any other time in summer except it supposed to be less crowded.  We'll see what happens.  DH is fine with a 4 day vacation and the kids want to go but didn't want to miss school which was the option was to pull them out october again.

The only things now are deciding how visiting my parents for summer and christmas will play out.

I have just finished our tax return for 2021.  Mostly it was waiting to see if there were any corrections for the 1099.  There wasn't but there has been in the past and usually it's Ameritrade and I wait until March 15th.  Anyway we filed and we owe $237.  Nice.  That the closest to $0 we have ever been. It's pretty nuts to be so close.  I also had to file the kiddos with their 1099B since I tax loss harvested in 2020 and then harvested some gains in 2021. 

I find it intersting how all over the place we've always been. You'd think we'd be more predictable since I do taxes for a living.  But there is always something so this is awesome that we are so close.  I would prefer to be plus or minus $500 every year.  But we've seemed to either a lot like four figures or get back four figures and I'm not usually happy either way.

How did your taxes turn out?