Tax Incentives

Top 3 Tax Breaks & Incentives for Homeowners

When you consider buying or selling a home, you should consider the fact that there are many tax benefits that could potentially make owning a home quite profitable.

HOME MORTGAGE INTEREST DEDUCTION

Homeowners — both single and married — are eligible to deduct interest paid on “qualified residence” loans up to a limit of $750,000. For a married homeowner filing a separate return, the limit is $350,000. The Internal Revenue Service defines a qualified residence as a taxpayer’s main home or second home.

PROPERTY TAXES DEDUCTION

Property taxes paid at the state and local level are eligible for a $10,000 deduction, or $5,000 for married taxpayers filing separately. This deduction applies to income and sales taxes as well.

MORTGAGE INTEREST CREDIT

This tax benefit is available to homeowners who meet certain qualifications. If you received a mortgage credit certificate (MCC) from your local government, you may be eligible to claim a portion of the mortgage interest you pay as a credit.

Local governments only issue MCCs on new mortgages that are used to purchase a taxpayer’s main home, and the government entity must be contacted about obtaining an MCC prior to a borrower taking out a mortgage.

Keep in mind that if you claim this credit, it counts against your home mortgage interest deduction, according to the IRS.

These are just the tip of the iceberg when it comes to tax breaks and incentives that homeowners can enjoy. Be sure to talk to your tax professional to get all the details.

At Shipp Group, we know our market like no one else. And, we can help you understand all fo the incentives you can benefit from whether you’re buying or selling. If you decide to buy, we’ll work harder than anyone else to get you into the best home for you and your family. If you choose to sell, we’ll work harder than anyone else to make sure you get a fair return on your investment. Contact us to learn more.