Taxes and Your Home—Here's What You Need to Know! | Red Rock Mortgage - Knoxville
According to the U.S. Census Bureau, 66.4 percent of the population in Tennessee are homeowners, which means they will be able to reap the benefits of owning a home this tax season. Our team at Red Rock Mortgage wants to share some insight about just exactly how you can use your home to your benefit.
Main Tax Benefits of Home Ownership
Let’s take a look at some of the tax benefits associated with owning a home.
First, you’re able to deduct the mortgage interest you paid during 2017. You should receive a statement from your mortgage company indicating exactly how much interest was paid. If you itemize deductions, you’ll then be able to include that amount on the mortgage interest line item.
In addition to the mortgage interest deduction, you’ll also be able to claim the property tax deduction. You can determine how much you paid in property taxes in a couple different ways. If your taxes are paid through your mortgage company (which is common), the amount paid will be included on your year-end statement, just like mortgage interest is. If you pay your property taxes to the city or county separately, you should receive a receipt upon payment.
Third, did you buy or sell a home in 2017? Other deductions may apply. If you purchased a home, you may be able to deduct your closing costs.
However, when you sell your home, that is when the real tax deductions come into play. According to tax law, you are able to be exempt from certain taxes when you sell your home, up to $250,000. As a result, you want to make sure you keep all your housing documents safe and close!
And finally, in some cases, you can also deduct other expenses of your home, like certain home improvements, as outlined by the IRS. But before trying to claim these deductions, it’s important to make sure you meet all of the parameters established by the IRS.
Are you wanting to reap the benefits of home ownership next year? Visit the Red Rock Mortgage Knoxville website today to learn how we can help you get pre-approved for a new home in 2018!