Looking to take advantage of even more tax benefits available to you with that home loan?
When you are a home or property owner, taxes can be overwhelming, no matter what state you live in. You may be thinking about taking out a home loan to finally have the house of your dreams but are feeling wary about how this could affect you, come Tax Season.
You can, however, rest assured. There’s actually a lot of tax relief available to taxpayers who’ve taken out a home loan.
Read on to learn more about the tax relief help you are eligible for as a homeowner, so that this coming tax season will be stress-free and beneficial to you.
Claim Benefits for A Home Office
If you work from a home office either for a full-time or part-time remote position, you can claim the cost of this office as a work expense when next filing your taxes. Homeowners and renters are able to apply for this home office deduction.
Determine the actual cost of using your home office by bringing mortgage or rent costs into consideration, as well as costs for utilities and general maintenance.
Your home office costs will come down to a percentage of total home cost–i.e., if your office takes up 20% of your entire home, you can estimate home office costs as about 20% of total home costs.
You will have to itemize your taxes in order to be eligible for this deduction.
Get Cash for Interest Paid on a Mortgage
This is probably the biggest form of tax relief help when it comes to taxpayers with home loans. When filing taxes, you can claim any interest you paid on mortgage payments since the start of the mortgage. This is the case for mortgages of up to $500,000.
You are still eligible for this hefty deduction even if you are the owner of a second home or a joint owner. In fact, joint owners are eligible for this deduction for up to $1 million in mortgage debt.
Mortgage interest deductions can save Americans an average of $1,900 annually. They are particularly valuable during the beginning of mortgage payment cycles when it can feel particularly tough to chip away at the mortgage total.
Trade Points for Tax Benefits
The mortgage points systems allow taxpayers to pay a certain amount of “points” up front when they are taking out a mortgage so that they can get a reduced interest rate, overall.
When filing your taxes, you can find tax relief help in the form of a full tax deduction for the points paid at the start of your mortgage. Keep in mind that this is the case if your intention of taking out a mortgage was to purchase a primary home.
High Property Taxes Can Lead to Higher Deductions
Property taxes are soaring in a number of states across the nation, but this can actually be a good thing when it comes to tax relief help.
No matter what your state of residence, you can claim those property taxes as tax deductions as of the year 2017. However, appraisal fees and costs associated with credit reports can’t be reported as write-offs.
You can claim property taxes only for years that you’ve actually made property tax payments.
Claim Interest on Home-Improvement Loans
If you took out a loan for any home improvement projects this last fiscal year, you can claim any interest paid on these loans this coming tax season. This is true for loans of up to $100,000 in total.
You can’t write off the cost of materials for this home improvement, however. But if you are thinking about selling your home in the future, you can definitely work the cost of home maintenance and improvement into your asking price.
Take Credit for Making Your Home Efficient
Homes that made steps to be more energy-efficient by incorporating renewable energy systems and sources or other energy-saving structures are eligible for tax deductions.
The Federal Tax Credit for Solar Energy is still active for the year 2017, enabling credits for homeowners with solar energy systems in their homes. These credits can total up to thirty percent of the cost of installation and equipment!
Talk to a Professional
There are many options for tax relief help for homeowners, but sometimes these options can seem daunting or confusing. If you are unsure about your qualifications for tax relief, it’s important to consult a professional.
Accountants and licensed tax lawyers will be able to go through all of your qualifications and make sure you can take advantage of all the tax benefits available to you as a homeowner. You’ll be able to come home with the highest deduction possible without making common tax mistakes.
If you are having trouble making tax payments as a homeowner, you may be eligible for other forms of tax relief help.
Home Loan Tax Relief Help for Taxpayers
Home loans don’t have to be prohibitive for taxpayers, especially with new tax plans coming out every year. There is actually a lot of tax relief help available to individuals with current home loans.
If you work from a home office, you can claim the cost of maintaining and keeping this as a work expense on your taxes, provided that you itemize these expenses. Most homeowners will also be eligible for deductions from interest paid on mortgages and home-improvement loans up to certain amounts. Don’t forget about those mortgage points paid when taking out your home loan, as well. Also, keep in mind what high property taxes can do for you on your upcoming tax return.
At the end of the day, the best way to make sure you are maximizing the tax benefits available to you as a homeowner is to consult a professional.
At Abajian Law, we can help you with any and all tax issues. Our extensive and reliable services cover tax litigation, tax fraud and crimes, liens, and more. Read our client testimonials to get a sense of what we can do for you and your taxes.