Tax Deductions for Homeowners: What You Need to Know
As a homeowner, you may be eligible for several tax deductions that can help you save money on your taxes. Here’s what you need to know about tax deductions for homeowners.
Mortgage Interest Deduction
One of the most significant tax deductions for homeowners is the mortgage interest deduction. This deduction allows you to deduct the interest you paid on your mortgage during the year from your taxable income. To claim this deduction, you must itemize your deductions on your tax return.
Property Tax Deduction
Homeowners can also deduct the property taxes they paid during the year from their taxable income. This deduction is also claimed by itemizing your deductions on your tax return.
Home Equity Loan Interest Deduction
If you took out a home equity loan or home equity line of credit (HELOC) to finance home improvements or other expenses, you may be able to deduct the interest you paid on the loan or line of credit. This deduction is also claimed by itemizing your deductions on your tax return.
Energy Efficiency Upgrades
Homeowners who make energy-efficient upgrades to their homes may be eligible for tax credits or deductions. These upgrades may include installing solar panels, upgrading insulation, or installing energy-efficient windows. The specific credits and deductions available vary by state and by the type of upgrade you make.
As a homeowner, there are several tax deductions and credits available that can help you save money on your taxes. It’s important to consult with a tax professional or use tax software to ensure that you’re claiming all the deductions and credits that you’re eligible for on your tax return