List of Tax Benefits for Buying a Home
Many people withdraw the idea of purchasing a house with the fear of paying huge mortgage interests. In fact, it is possible to save good amount on tax returns by becoming a homeowner. Tax benefits for buying a home 1. Mortgage interest that is paid in monthly instalments can be deducted from the tax returns. 2. It is possible to save on profit made by selling the house. The profit is considered as capital gain and is eligible for tax exemption. 3. Interest on home improvement loans that are taken to improve the value of the house can be deducted from tax returns. 4. If you are using a part of your home as an office, it is possible to deduct home office expenses from the taxable income. 5. The premium paid on home insurance can also be included in the deductible amount. 6. Whilst purchasing a house, it is essential to pay points to the lender to obtain a mortgage. The amount paid in the form of points is defined by the loan amount. It is possible to deduct the points from your taxable income. 7. If you are renting the property, you can deduct the maintenance costs, travel expenses incurred in solving tenant complaints and other expenses related to rental activity. However, it is essential to provide proof of everything. If you are not efficient at calculating tax benefits associated with homeowners, hire a solicitor to get the work done for you.