Although the following information should prove helpful, it is not intended as tax advice. In addition, tax laws change continually, so seek the advice of your tax professional for complete tax advice.
The federal government supports home ownership by providing income tax advantages such as tax deductions, deferments and exclusions to buyers of homes. These tax benefits are different for a property used as a principal or main residence than for property purchased for investment purposes. In general, homeowners may deduct the following from their gross income to reduce their taxable income:
Ø Loan interest payments on first and second homes that meet the definition of “qualified residence interest”
Ø Real estate property taxes, but not ithe nterest paid on any overdue taxes
Ø Selected loan discount points
Ø Selected loan origination fees
Ø Loan prepayment penalties
Ø Casualty losses to the real estate not covered by insurance. |
