Are there tax advantages to owning a home?
There are many tax advantages to owning a new home. Mortgage interest The interest you pay each year on your mortgage loan is fully deductible from your income. The limitations are only that the mortgage must be for a first or second home, and the mortgage amount must meet established guidelines. Points or origination fees Points are charged by the lender in connection with your home loan, and are fully deductible in the year you pay them. If you obtain a home equity loan in future years in order to make additions to your home, those charges are again deductible, subject to some limitations, also reducing your tax liability. Property taxes The property taxes you pay on your home are also deductible from your income at tax time. Check your year-end mortgage statement to discover how much property tax you paid. If you pay the tax separately from your mortgage, keep track of those records.
