Tax Breaks for New Homeowners

Benefits of becoming a homeowner are vast. One in particular is the tax break you may be able to claim if you purchased a home in 2014.

Deductions Include:

  • Mortgage Interest
    Most all interest paid on your home is tax deductible.
  • Points
    If you buy a new home and elect to pay points to get a lower rate, then this is also tax deductible. The IRS allows you to deduct points in the year you paid them, if your loan was to purchase your primary residence. Also, if you are looking to refinance, points may also be eligible for this tax break. Make sure you consult your tax professional regarding how refinance point deductions work.
  • Taxes
    Property taxes are part of homeownership and paid into an escrow account. Typically, when a property is being transferred from one owner to another the year’s tax payments will be divided per the portion of the year each person owns the home.  When you close on your home, you will receive a HUD Settlement statement, keep this and provide to your tax professional. This deduction must be listed on your Schedule A as an itemized expense.