Interest on self assessment tax
Assuming you are Resident Indian. As per Indian Income Tax  As per section 208 every person whose estimated tax liability for the year exceeds Rs.   10,000, shall pay his tax in advance in the form of “advance tax”. Thus, any taxpayer   whose estimated tax liability for the year exceeds Rs. 10,000 has to pay his tax in   advance by the due dates prescribed in this regard. However, as per section 207, a   resident senior citizen (i.e., an individual of the age of 60 years or above) not having any income from business or profession is not liable to pay advance tax.   In other words, if a person satisfies the following conditions, he will not be liable to pay advance tax:   Hence only self assessment tax need to be paid without any interest. Refer the full guideline on Income tax website
NO.  The legislation requires the landlord to deposit it in a bank.  Check out pages 7-10 of the linked document.  There is no mention of interest. The second clause, I believe, is probably for large landlords who hold hundreds of thousands of dollars of security.   http://www.legislature.mi.gov/documents/publications/tenantlandlord.pdf Q4 Once collected, what must the landlord do with the security deposit?   The landlord must either: a) Deposit the money with a regulated financial institution (e.g.,   bank), OR b) Deposit a cash bond or surety bond, to secure the entire deposit,   with the Secretary of State. ( Note: If the landlord does this, he or   she may use the money at any time, for any purpose.) The bond ensures   that there is money available to repay the tenant’s security deposit "From the IRS page on Estimated Taxes (emphasis added): Taxes must be paid as you earn or receive income during the year, either through withholding or estimated tax payments. If the amount of income tax withheld from your salary or pension is not enough, or if you receive income such as interest, dividends, alimony, self-employment income, capital gains, prizes and awards, you may have to make estimated tax payments. If you are in business for yourself, you generally need to make estimated tax payments. Estimated tax is used to pay not only income tax, but other taxes such as self-employment tax and alternative minimum tax. I think that is crystal clear that you're paying income tax as well as self-employment tax. To expand a bit, you seem to be confusing self-employment tax and estimated tax, which are not only two different things, but two different kinds of things.  One is a tax, and the other is just a means of paying your taxes. ""Self-employment tax"" refers to the Social Security and Medicare taxes that you must pay on your self-employment income.  This is an actual tax that you owe.  If you receive a W-2, half of it is ""invisibly"" paid by your employer, and half of it is paid by you in the form of visible deductions on your pay stub.  If you're self-employed, you have to pay all of it explicitly. ""Estimated tax"" does not refer to any actual tax levied on anyone.  A more pedantically correct phrasing would be ""estimated tax payment"".  Estimated taxes are just payments that you make to the IRS to pay tax you expect to owe.  Whether you have to make such payments depends on how much tax you owe and whether you've paid it by other means.  You may need to pay estimated tax even if you're not self-employed, although this would be unusual.  (It could happen, for instance, if you realized large capital gains over the year.)  You also may be self-employed but not need to pay estimated tax (if, for instance, you also have a W-2 job and you reduce your withholding allowances to have extra tax withheld). That said, if you earn significant income from self-employment, you'll likely have to make estimated tax payments.  These are prepayments of the income tax and Social Security/Medicare taxes you accrue based on your self-employment income. As Pete B. mentioned in his answer, a possible reason that your estiamtes are low is because some taxes have already been withheld from the paychecks you received so far during the year (while you were an employee).  These represent tax payments you've already made; you don't need to pay that money a second time, but you may need to make estimated tax payments for your income going forward." Am I eligible for the tax exemption if yes then under which section.  Generally Personal loans are not eligible for tax exemption. Only housing loans from qualified institutions are eligible for tax deduction. As per the income tax act; The house should be in your name. The home loans taken from recognised institutions are fully qualified under section 24B and 80C. This means you can claim Interest exemption under 24B and Principal repayment under 80C. The Act also specifies that loan can be taken from friends/relatives for construction of property and will be eligible for Interest exemption under 24B only. The principal will not be eligible for exemption under 80C. Read the FAQ from Income Tax India. There has to be certificate showing how much interest was paid on the said loan. Further there should be records/receipts on how the money was spent. There is difference of opinion amongst CA. It is best you take a professional advise. Some advice from my side:  - You can get your tax up to 4 years back,  - The prices of tax advisory in Munich (for basic tax declaration) vary from 36 € up to 170 € - Depends how much your earn. Here you can calculate the the price for yourself: http://getdoido.com/tax_declaration If you want to know more how to do the tax declaration by yourself then check my last blog post where I described step-by-step how to make a tax declaration by yourself in Germany :) "Can I claim a 20% of the interest paid over the period of Oct/2015 through Mar/2017 (18 months) when I file for IT returns this year in Mar/2017? Yes you can. Does my name not being the first name affect my eligibility of claiming the relief? No you can claim relief. Joint owners need to file a declaration on the quantum of relief claimed. Both can't claim 100%. Does that mean I my claiming the 20% relief on interest (and the remaining 80% over subsequent years) is in effect moot as my ""taxable"" income cannot go negative (meaning the govt cannot/will not return some money I have paid as IT in prior years)? If you have no other income on which tax is payable; then Yes it is irrelevant. Does that mean as long as I continue to work in the US (already having become a NRI), have little or no income in India, I cannot claim any future relief regarding the principal or interest? Yes that is right." "No. The full text of the Landlord-Tenant Act (specifically, section 554.614 of Act 348 of the year 1972) makes no mention of this. Searching the law for ""interest"" doesn't yield anything of interest (pardon the pun).  Specifically, section 554.604 of the same law states that: (1) The security deposit shall be deposited in a regulated financial   institution. A landlord may use the moneys so deposited for any   purposes he desires if he deposits with the secretary of state a cash   bond or surety bond written by a surety company licensed to do   business in this state and acceptable to the attorney general to   secure the entire deposits up to $50,000.00 and 25% of any amount   exceeding $50,000.00. The attorney general may find a bond   unacceptable based only upon reasonable criteria relating to the   sufficiency of the bond, and shall notify the landlord in writing of   his reasons for the unacceptability of the bond. (2) The bond shall be for the benefit of persons making security   deposits with the landlord. A person for whose benefit the bond is   written or his legal representative may bring an action in the   district, common pleas or municipal court where the landlord resides   or does business for collection on the bond. While it does sound like the landlord is required to deposit the money in a bank or other secured form, e.g. the Secretary of State, he/she isn't required to place it in an account that will earn interest." The answer is simple. You can generally claim a deduction for an expense if that expense was used to derive an income. Most business expenses are used to derive profits and income, most individual expenses are not. Of course social policy sometimes gets in the way and allows for deductions where they usually wouldn't be allowed. Regarding the interest on a mortgage being deductible whilst the principal isn't, that is because it is the interest which is the annual expense. By the way deductions for mortgage interest in the USA for a house you live in is only allowed due to social policy, as there is no income (rent) being produced here, unlike with an investment property. It's for the benefit of the bank, certainly.  You might consider it a convenience to write one check, but it comes at a cost. Your cost of money is the interest you pay on the most costly loan you carry. But the escrow account will usually get a low rate of interest, 1% or so today.  Also, as I describe in an article titled Fun With Schedule A there's a strategy for those who straddle the line between itemizing and taking the standard deduction. Paying your own tax allows you to pay as much as 6 quarters of property tax in one year and then just two quarters in the next. This opens up a biannual itemizing and a savings on your tax return. "Charging interest by non financial institutions is allowable. There is only one definition of illegal or criminal interest and this is regarding loan sharks.  Section 347 of the Canadian Criminal Code makes it illegal to charge more than 60% annually.   The biggest debate was whether or not ""pay day"" loan companies were breaking the law.  The recent bill C-26 amends this section to exempt ""pay day"" loans from this definition." I am not an accountant, but I do run a business in the UK and my understanding is that it's a threshold thing, which I believe is £2,500. Assuming you don't currently have to submit self assessment, and your additional income from all sources other than employment (for which you already pay tax) is less than £2,500, you don't have to declare it. Above this level you have to submit self assessment. More information can be found here I also find that HMRC are quite helpful - give them a call and ask. "One way to do these sorts of calculations is to use the spreadsheet version of IRS form 1040 available here.  This is provided by a private individual and is not an official IRS tool, but in practice it is usually accurate enough for these purposes.  You may have to spend some time figuring out where to enter the info.  However, if you enter your self-employment income on Schedule C, this spreadsheet will calculate the self-employment tax as well as the income tax.  An advantage is that it is the full 1040, so you can also select the standard deduction and the number of exemptions you are entitled to, enter ordinary W-2 income, even capital gains, etc. Of course you can also make use of other tax software to do this, but in my experience the ""Excel 1040"" is more convenient, as most websites and tax-prep software tend to be structured in a linear fashion and are more cumbersome to update in an ad-hoc way for purposes like tax estimation.  You can do whatever works for you, but I would recommend taking a look at the Excel 1040.  It is a surprisingly useful tool." Two points You don't really get the full 10,000 annual interest as tax free income.  Well you do, but you would have gotten a substantial amount of that anyway as the standard deduction. ...From the IRS.... Standard deduction The standard deduction for married couples filing a joint return is at $11,900 for 2012. The standard deduction for single individuals and married couples filing separate returns is $5,950 for 2012. The standard deduction for heads of household increases by $50 to $8,700 for 2012. so If you were married it wouldn't even make sense to claim the 10,000 mortgage interest deduction as the standard one is larger. It can make sense to do what you are talking about, but ultimately you have to decide what the effective interest rate on your mortgage is and if you can afford it. For instance.  I might have a 5% mortgage.  If I am in a 20% tax bracket it effectively is a 4% mortgage to me.  Even though I am saving tax money I am still paying effectively 4%.  Ultimately the variables are too complex to generalize any hard and fast rules, but it often times does make sense. (You should also be aware that there has been some talk of eliminating or phasing out the mortgage interest deduction as a way to close the deficit and reduce the debt.) I will add one point missing from the answers by CQM and THEAO. When you take a loan and invest the proceeds, the interest that you pay on the loan is deductible on Schedule A, Line 14 of your Federal income tax return under the category of Investment Interest Expense.  If the  interest expense is larger than all your investment earnings (not just those from the loan proceeds), then you can deduct at most the amount of the earnings, and carry over the excess investment interest paid this year for deduction  against investment earnings in future years. Also, if some of the earnings are long-term capital gains and you choose to deduct the corresponding investment interest expense, then those capital gains are taxed as ordinary income instead of at the favored LTCG rate. You also have the option of choosing to deduct only that amount of interest that offsets dividend (and short-term capital gain) income that is taxed at ordinary rates, pay tax at the LTCG rate on the capital gains, and carry over rest of the interest for deduction in future years. In previous years when the tax laws called for  reduction in the Schedule A deductions for high-income earners, this investment interest expense was exempt from the reduction. Whether future tax laws will allow this exemption depends on Congress. So, this should be taken into account when dealing with the taxes issue in deciding whether to take a loan to invest in the stock market. "My teacher always says the property interest the beneficiary ""holds"" or ""possesses"" is an equitable interest.  I might just seem out of place here because it's a legal term and probably not commonplace outside that sphere. But the beneficiaries equitable interest is possessed or held in that regard. From this equitable interest is the income stream.   If that just seems like a bunch of gibberish to you than don't mind me, just trying to learn the ins and outs of trusts not the world of finance generally." "You should really be talking to a tax adviser (EA/CPA licensed in your State) about taxes and to a lawyer about the liability protection. You won't find answers from neither of theses here. Besides the liability protection, how do these 2 options affect taxes? There's no liability protection difference between the two (talk to a lawyer to verify) since you'll be cosigning them personally either way. In the first case (loan to the LLC) - everything goes on the 1065 and you get the bottom line on K-1 which transfers to you own tax return. In the second case the loan interest is your personal investment expense (Schedule A deduction) while the loan proceeds you moved to the LLC add to your basis. I'd suggest getting the loan directly in the LLC name, if you can. However, the Lawyers seem to agree that this would void the mortgage   because of the ""Due on Sale"" clause in mortgage loans. ""Due on sale"" may or may not be invoked, but that's a risk you'd be taking, yes. LLC is a separate legal entity (as opposed to a living trust, to which your second quote seems to be referring), so it is definitely a possibility for a lender to call on the loan if you re-title it."