Buying a home can be very beneficial, especially when it comes to tax time! To be sure of all tax deductions of owning a home you will want to check with your accountant, but we will go over a few common ones below.
Mortgage Interest Deduction:
One of the main tax deductions homeowners take advantage of is the mortgage interest deduction. Any interest you pay on your mortgage is deductible up to a certain amount depending on if you are filing single or married. You can also take advantage of the mortgage interest deduction when paying interest on a home equity loan or home equity line of credit.
Mortgage Points Deduction:
Another tax benefit if being able to deduct any mortgage points you paid at closing when you purchased your home. If you are unsure if you paid points at closing, you can check your Closing Disclosure or check back in with your lender.
State and Local Taxes Deduction:
A common deduction that homeowners take advantage of is deducting any state and local taxes you pay. Most commonly, your property taxes.
Home Office Deduction:
Do you work from home? If so, you may be able to eligible for the home office deduction. You must use a portion of your home exclusively for your business and be able to show that your home is the primary location of the business.
Make sure to contact your personal accountant to make sure there are not additional deductions you may qualify for.