Do you own your home? Whether you’ve invested in a house recently or you’ve been paying a mortgage for a while, there’s a number of tax breaks homeowners qualify for around the country. If you’re looking to cut back on your expenses, it’s worth learning about possible exemptions for homeowners and getting started on the necessary paperwork.
If you’re not already collecting these 10 tax breaks, here’s a breakdown of each one, which you can learn about in more detail when completing your taxes.
1. Mortgage Interest – Under certain conditions like filing your taxes jointly with your spouse, you can deduct the interest you pay on your mortgage if you earn less than roughly $100,000 per year.
2. Points – The points you paid your mortgage lender upon closing the deal on your house often amount to thousands of dollars. These fees are tax deductible in some cases.
3. Equity Loan Interest – If you’re paying interest on either a home equity loan or your line of credit, you can often deduct this expense even though a couple of conditions may apply.
4. Home Improvement Loan Interest – After you use a loan to pay for costly improvements in and around your home, the interest will be deductible as long as the job enhances your property’s value immensely.
5. Property Taxes – You have the option to deduct both city and state property taxes from your income in many respects.
6. Home Office Deduction – If you conduct business from your home on a regular basis, you have the opportunity to deduct costs related to this use of your home.
7. Selling Costs – After you’ve accumulated a range of fees from selling your home, you can deduct these selling costs from your final gain.
8. Capital Gains Exclusion – If you sell a home that you and your spouse used for two years over the past five years, you can often keep up to half a million dollars of the profits tax-free.
9. Moving Costs – Your moving costs can be deducted once you’ve relocated for a new job as long as you meet a number of the requirements set by the IRS.
10. Mortgage Tax Credit – This tax break is designed for low-income, first-time buyers so they can receive a set percentage of the tax credit on their mortgage interest.
If you’re not already collecting these 10 homeowner tax breaks, it’s time to start figuring out which ones you qualify for and using them accordingly. Almost every state offers a certain degree of tax relief for residents who own their own homes, so discover more information about the ones that apply to you here and begin saving money.
When you’re ready to take the next steps toward earning homeowner tax breaks, please don’t hesitate to reach out to me for more information.