Tax Advantages Of Homeowners That Renters Cannot Get

Tax Advantages Of Homeowners That Renters Cannot Get

Image title

It's the last quarter of 2016; time to start thinking about the write-offs you are going to use for this year's taxes. Home ownership comes with some exemplary tax benefits. The benefits can be in the thousands depending on your specific situation.

The mortgage interest deduction

This deduction allows homeowners to deduct the interest paid on loans up to $1 million or less. This is especially helpful in the early years of your loan when payments mostly go to interest. 

Here is an example:

If you have a $250,000 30-year fixed rate loan with a 4.5% interest rate you would pay approximately $11,000 in interest the first year. A person in a 25% income tax bracket would save about $2,750 with this deduction.

Discount points

Interest rates can be reduced by purchasing "points". Each point usually costs 1% of the loan amount. 25% of these points can be deducted. If you purchased $2,000 in points, you would net a $500 tax savings. 

Property taxes

Property taxes paid on real estate are entirely deductible on federal income taxes. 

Mortgage insurance premium deduction

Loans with low-down payment options such as FHA and conventional loans with less than 20% down require mortgage insurance to protect the lender from default. Although this can make your monthly loan payment higher, it's great come tax time because it can be an itemized deduction from federal income taxes of those with an adjusted gross income of $109,000 or less ($54,500 if married filing separately).

Profits from a home sale

Tax benefits are not just for buyers! Sellers benefit too! Capital gains (profits) from a home sale are totally free from federal income tax up to $250,000 for individuals and $500,000 for joint filers. 

If you are thinking about  buying or selling a home in Kingman Arizona, give me, Amy Rodriguez Realtor, a call at 928-202-6149 or visit my website amy.az.queenteamhomes.com for more info. The Queen Team at Keller Williams Realty


Becca Johnson Headshot
Author:
Phone: 928-303-8134
Dated: November 4th 2016
Views: 337
About Becca: ...

Property Search








RSS Feed

View our latest blog posts in your RSS reader. Click here to access. RSS

Search Blog

Recent Blogs

Start Off The New Year With A Bang -     With the
Must Know Info For The SelfEmployed Home Buyer - Must-Know Info for the Self
Should I List My Home During The Holidays - Absolutely! Motivated buyers don't
Lake Havasu Events And Holidays - How Lake Havasu Does Events!Lake

Saved Properties

This is a list of your favorite properties. We will email you if a property is reduced or leaves the market.

Click 'Save' to add a property to this list.

Register / Login

New & returning visitors please enter your information to login.

By clicking 'register' you are agreeing to our terms of use & giving us expressed written consent to contact you.

Questions? Comments? Complaints?

This message will go directly to the head of our team.

Location & Address

Keller Williams Arizona Living Realty - #BMP Network
2800 Hualapai Mountain Rd.
Kingman, AZ
928-263-6854
928-718-6215

Other Locations