Owning a home comes with many tax benefits. Understanding your options can save you thousands of dollars. Here's an overview of key deductions and considerations:
Standard Vs. Itemized Deductions
Standard Deduction (2024): $14,600 (single), $29,200 (married filing jointly), $21,900 (head of household).
Itemizing can make sense if your total deductions exceed the standard amount.
7 Tax Breaks for Homeowners
Mortgage Interest: Deduct interest on mortgages up to $750,000 (or $375,000 if married filing separately).
Home Equity Loan Interest: Deductible if funds are used for home improvements.
Discount Points: Deduct points purchased to lower your mortgage interest rate.
Property Taxes: Deduct up to $10,000 ($5,000 if single or married filing separately).
Necessary Home Improvements: Medical-related upgrades may qualify.
Home Office Expenses: Deduct a percentage of your home used exclusively for business.
Capital Gains: Exclude up to $500,000 (married filing jointly) or $250,000 (single) from profits when selling your primary home if lived in for 2 of the last 5 years.
Nondeductible Home Expenses
Expenses like fire insurance, utilities, and mortgage principal payments aren’t deductible.
The Bottom Line
Explore your tax deductions and compare itemized deductions to the standard deduction to maximize savings. Consult a tax professional to ensure you’re taking advantage of all available tax breaks.
Commenti