Your home is your castle – your refuge from the workaday world, the oasis where you kick back and relax, spend time with your family and just generally enjoy life. But did you know that your beloved piece of Grand Junction real estate can also provide you with tax benefits? It’s true; the IRS looks very favorably upon home owners.
If you’re a new home owner, you’ll be glad to know that you can deduct a good many expenses related to your home. It doesn’t matter if it’s a condo, town house or single family residence, there are tax deductions available to you. You can just take a standard deduction, but if you’re comfortable with your taxes being a bit more complex (i.e. you’ll need to navigate Form 1040 and also Schedule A), you can get some nice breaks.
When buying a new home, you can deduct the interest that you pay on your monthly loan. Origination fees and loan discount points are also deductible. Even if the closing fees were paid by the seller, you can still claim these discounts. To say the least, this is a huge bonus to the purchaser. You really can’t complain about a deduction that you can benefit from even if you didn’t make the payment personally. Given that origination fees are usually at least one per cent of the purchase price, this can add up to a significant financial benefit for you when you buy a home.
This is just the tip of the iceberg when it comes to tax benefits for homeowners. In this quick three-part tutorial, we’re not going to be able to detail every single advantage you’ll have as a home owner, but we’ll get you started. You can check out the IRS website for more information, or talk with your real estate broker or agent.
In part 2, we’ll talk about mortgage interest.