April 15th is just around the corner so don’t forget to do your Taxes! One of the great things about the United States is that the tax code is written to encourage home ownership. The Government allows for some significant deductions that could potentially save you thousands. Here are a couple you aren’t going to want to miss.
1. Mortgage Interest Deduction
This is probably the most obvious one, but you are able to deduct all the interest you pay over the course of the year. For many people this is the single most significant tax deduction they take every year. Homeowners who recently purchased their homes are able to deduct more since you pay much more interest at the start of your loan than the end.
2. Some Closing Costs are Deductible
If you bought a house last year you are able to deduct “points” which are the origin fees on your loan. The best part is it doesn’t matter whether or not they were paid by you or the seller. Many times this can be around 1% which is a significant deduction when you recently purchased a home!
3.Property Tax is Deductible
This one is self explanatory. You can and should be deducting the property tax you pay! This one is a bit easier to forget since it is typically paid for with your mortgage payment so don’t forget to deduct the full amount you paid!
4. Own a Second Home?
You can also deduct the mortgage interest and the property taxes on your second home. There is a limit of just over a million though.
5. Do you have a home office?
In 2013 the Government changed the tax code to make it more simple to write off $5.00 per square foot of office space. The catch is the office needs to be your primary office, not an auxiliary office.
These are just a few simple deductions. There are additional tax deduction for folks who have refinanced recently, for folks who have Home Equity Loans and even for those who have recently sold their home. Feel free to contact me with any questions, but I will leave the tax advice to your friendly (especially this time of year) CPA! I hope you keep lots of money in your pockets this year!
Questions? Contact Me
