If you’re thinking about purchasing a home, you could benefit from a significant tax savings. When it comes time for a homeowner to file taxes, he or she can deduct mortgage interest, property taxes, and much more!
Mortgage Interest and Property Taxes
One of the greatest tax benefits of owning a home is the ability to deduct the cost of your mortgage interest. Currently, you can deduct the interest on mortgage debts up to $1 million (for mortgages that were taken out prior to 12/16/17; however, with the new Tax Cuts and Jobs Act, the ceiling has been cut to $750,000 for mortgage debts taken out between 2018-2025). Regardless of which mortgage cap applies to you, this can still result in some seriously significant savings.
In addition, you should also be able to deduct the cost of your yearly property taxes, resulting in additional savings on your tax bill.
Another way that homeowners can get a tax break is by deducting the costs of any energy-efficient upgrades made to the home during the tax year. This tax deduction can include the costs of both the equipment and the installation. Making these types of upgrades are not only good for the environment but also good for your wallet.
If you’re interested in learning more about the tax benefits of owning a home, Taxation Solutions, Inc. is here to help. Get in touch with us and see how much you can save as a homeowner!