.png)
💰 The Real Tax Benefits of Owning a Home
- wendymonday
- 1 day ago
- 2 min read
Buying a home isn’t just about building equity or having a place that’s truly yours — it can also come with meaningful tax benefits. Here’s a simple breakdown of the ways homeownership can help you at tax time:
1. Mortgage Interest Deduction
One of the biggest perks: you can deduct the interest you pay on your mortgage (up to certain limits set by the IRS). Especially in the early years of your loan, when most of your payment goes toward interest, this can make a real difference.
2. Property Tax Deduction
Homeowners can deduct state and local property taxes — up to a combined $10,000 under the current “SALT” cap.
3. Capital Gains Exclusion
If you’ve lived in your home for at least two of the past five years, you can exclude up to $250,000 in profit from taxes (or $500,000 if you’re married filing jointly) when you sell. That’s a huge advantage over other types of investments.
4. Mortgage Points Deduction
If you paid points to lower your interest rate, those may also be deductible. Think of it as a little reward for buying down your rate.
5. Home Office Deduction
If you work from home and have a dedicated workspace, you might be able to deduct a portion of your housing costs — things like utilities, insurance, and maintenance — based on the size of your workspace.
6. Energy Efficiency Credits
Adding solar panels, energy-efficient windows, or a high-efficiency HVAC system can qualify you for federal tax credits. It’s one of those rare “do good, save money” situations.
7. Private Mortgage Insurance (PMI) Deduction
Depending on your income, you may be able to deduct PMI premiums if you put down less than 20%.
8. Home Equity Loan Interest
If you use a home equity loan or line of credit for improvements to your property, the interest on that borrowing may be deductible too.
The Bottom Line
While every homeowner’s situation is different, these deductions and credits can add up. If you’re thinking about buying or you already own, it’s worth talking with your tax professional to make sure you’re maximizing every benefit available.
DISCLAIMER : I am a real estate agent, not a tax accountant. All information contained herein is believed to be accurate but is not warranted or guaranteed. You should contact your tax professional to confirm the tax advantages available to you.
