Homeowner Tax Breaks

Homeowner Tax Breaks – There are several breaks when it comes to owning property. You can get a tax credit on much of your related expenses. There are also IRS homeowner incentives that you can write-off for energy efficient upgrades.The bad news is, to take full advantage of these IRS incentives, your paperwork will likely get more complicated. That means you’re not living on “EZ” Street anymore; you’ve moved to the 1040 long form and Schedule A, where you’ll have to detail your deductible expenses to get homeowner tax breaks.
For many homeowners, the effort of itemizing is well worth it at tax time. Some, however, might find that claiming the standard deduction remains their best move. How do you decide?
First, find your standard deduction amount, based on your filing status: $5,450 for taxpayers who are single or married but filing separately; $8,000 for heads of households; and $10,900 for married couples who file joint returns. Then compare it to the total expenses you can itemize and file using the method that gives you the larger deduction.

To help you figure your possible Schedule A tax breaks, here’s a look at homeowner expenses you can deduct, ones you can’t and some tips to get the most tax advantages out of your new property owning status.
Your biggest tax break is reflected in the house payment you make each month since, for most homeowners, the bulk of that check goes toward interest. And all that interest is deductible, unless your loan is more than $1 million. If you’re the proud owner of a multimillion-dollar mortgaged mansion, the Internal Revenue Service will limit your deductible interest.
Interest tax breaks don’t end with your home’s first mortgage. Did you pull out extra cash through refinancing? Or did you decide instead to get a home equity loan or line of credit? Either way, that interest also is deductible, again within IRS guidelines.