Owning a home is rewarding in many ways, not the least of which is having a place of your own. The benefits of homeownership are numerous, including building equity into your future. There are also many tax advantages from which you can benefit with the purchase of a home.
Following are some of the tax deductions and benefits that are available to homeowners:
Mortgage Interest - Most homeowners have the ability to deduct the mortgage interest paid during the year from their tax obligations. For most homeowners, their monthly mortgage payment is made up largely of interest, often making this a sizable deduction.
Closing Costs - In many cases, the year you purchase your home, you are able to claim the points paid on your home mortgage loan, even if the seller paid them. These savings can be significant, as many origination fees are 1% of the loan or more.
Property Taxes - Property taxes for your primary residence and/or vacation home are fully deductible from your tax obligations.
Home Offices - If you work from home, your home office space and expenses are tax deductible. While up to 300 square feet can be considered an office space, there are strict rules regarding this deduction. Talk to a tax professional to learn what constitutes a tax-deductible home office space.
If you are interested in speaking to an accountant about the tax benefits that homeownership can provide to you, I would love to refer you to one of my business partners. If you are considering purchasing a home or refinancing your current house, call me today so that we can discuss your options!