First the good news: as a homeowner, you can deduct many home-related expenses. The bad news is you’ll probably have to file an itemized tax return to do so. No more 1040EZ for you!
Still, the amount you’ll be able to deduct should make the extra paperwork worth it. Especially when it comes to the mortgage interest deduction. Because every penny of that interest is deductible, unless your loan is more than $1 million. If you refinance and pull out extra cash, or get a home equity loan or line of credit, that interest is deductible, too.
You can also deduct any points you pay on your mortgage, although you’ll have to ask a tax professional for help with this one, as there are several factors that determine when you can deduct them.
Finally, in most instances your property taxes are also deductible for as long as you own your home.
For more information about the tax benefits of homeownership, contact us today.