Common Homeowner Tax Deductions
Tax season. Oh that dreadful time of year! Taxes (for most people) are no fun and can be a bit painful on the budget. We hope the following list of potentially deductible items for homeowners might help you out this tax season!
10 Tax Deductions for Homeowners
We are not certified CPAs. The potential homeowner tax write-offs listed below are ideas for you to speak about with your personal accountant or tax specialist. Not all will apply for everyone.
1. Mortgage Interest
The interest you pay on your mortgage every month is most likely tax-deductible, if you aren't living in a $1 million home.
If you have paid points to get a better rate, you may be able to deduct the money paid for the points. You may be able to deduct points the year they were taken out, or you may have to deduct them in segments over the life of the loan.
You pay property tax monthly along with your loan. These may be deductible annually.
4. Selling Your Home at a Profit
Under certain circumstances, homeowners may need to pay taxes on the profit from the sale of their property. There are a few situations which may provide some relief if you fall in this category, including; death, divorce, job loss, employment change result in pay decrease, or multiple births from one pregnancy.
5. Selling Costs
Title Insurance, advertising and potential broker fees associated with the sale of your home may be deductible.
6. Home Improvements
Save your receipts! This won't help with taxes now, but it could potentially when you sell your home.
7. Energy Credits
Improvements to your home to aid in energy efficiency can award you tax credits, which lowers your taxes dollar-for-dollar.
8. Home Equity Loans
If you borrow against the equity in your home to finance an addition, help pay a child's tuition, etc., you might be able to deduct interest on up to $100,000 of home-equity debt as mortgage interest.
9. Private Mortgage Insurance
Lower-income homeowners who put less money down pay Private Mortgage Insurance (PMI). This will be deductible in most cases.
10. Moving Costs
If you need to move due to an employment change more than 50 miles, and work 39 weeks in the 12 months following your move, you may be able to deduct several costs of moving including transportation, lodging and storage fees.