Possible Tax Benefits for Homeowners

While everyone’s situation is different, many homeowners find that they’re able to reap the benefits of homeownership, which often include:

Mortgage interest. For most people, the majority of a monthly mortgage payment goes toward paying off interest. Often, that interest is deductible (unless your loan is over $1 million, in which case the amount you can deduct is limited).

Points. If you paid points to get a better rate on a mortgage, you could claim them on your tax return as a deduction. However, it’s a good idea to talk to a tax expert about when you can claim your points.

Property taxes. Because some of your monthly loan payment likely goes toward property taxes, where it sits in escrow until they’re due, you can typically deduct them each year for as long as you own the home.

Profits. If you’ve made a profit on the sale of one home as you moved into another, you might be able to deduct some of the profits you made. However, these instances are limited to meeting certain requirements or if you’ve sold under certain circumstances.