What is Point's tax treatment? What taxes do I pay?
You should consult with your tax advisor before taking an investment from Point. Tax laws are complex. They vary by state, and your situation may have unique characteristics.
For many homeowners that Point invests with, the following is true:
- Point (and Point's investors) pay taxes on its share of any appreciation, which reduces your capital gains if you exit through a sale.
- If you pay Point at the end of the term without selling the property, there is no capital gains event because you did not sell your home. There may still be an opportunity for other tax deductions though based on the amount you paid Point.
- The initial Point funds (also known as the Option Investment Payment) are a tax-deferred payment.
- The following are examples of when you may be subject to taxes related to your Point HEI:
- You sell your home
- You repurchase the obligation from Point for an amount less than the Option Investment Payment
- Point cancels the Agreement, releasing you from any obligations
Again, homeowners should consult with a tax advisor before taking a Point investment. Point disclaims any representation or warranty concerning tax treatment of the Point Homeowner Agreement, whether generally, or as it applies to your unique situation.