Owning a home offers a tremendous amount of tax benefits. Find out how home ownership can ease some of your tax burden. Here are some tax breaks homeowners can take advantage of to make sure you are getting all the benefits from your home ownership.
The mortgage interest deduction is capped at interest paid on no more than $750,000 of the principal. If you have a mortgage that went into effect before Dec. 15, 2017, you can continue to deduct interest on loans up to $1 million.
You can still deduct interest on the proceeds from an equity line that were used to improve your home, as long as the total principal from the first mortgage and the equity line don’t exceed the original mortgage or the $750,000 cap.
You may deduct a total of $10,000 of all taxes, real estate and personal property taxes and state and local income or sales tax. Taxpayers that live in high income or high property tax states may be limited to a lesser amount of taxes than what was actually paid.
Private Mortgage Insurance (PMI)
At this time, mortgage insurance premiums are no longer allowed as an itemized deduction.
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