The Tax Benefits of Owning a Home:
How To Get a Tax Break for Buying a House

1. Mortgage Interest

Deducting your mortgage interest is one of the tax benefits of owning a home! If you have less than $750,000 in mortgage debt, you can deduct all of your mortgage interest. According to Investopedia and H&R Block, you can deduct home mortgage interest on up to $1,000,000 if you purchased your home before the end of 2017.

2. Mortgage Insurance

You can also get a tax break for buying a house if you have PMI, or private mortgage insurance. Typically, a lender will charge you private mortgage insurance if your down payment is less than 20%. However, you can talk to your tax professional about deducting your PMI payments depending on what your income level is.

3. Property Taxes

According to Rocket Mortgage, another tax benefit of owning a home is that you can deduct a portion of your property taxes. These will depend on your location, but you can get quite a bit of money deducted at the local and state level.

4. Home Improvements & Renovations

If there are necessary improvements that you need to make for your home, these can qualify as one tax break for buying a house. Things that might qualify as necessary improvements could include building a home office if you work from home, implementing necessary medical or accessibility equipment, or other things that are required for a functioning home.

5. Mortgage Points

One more tax break for buying a house that you can utilize is what is known as a mortgage points deduction. If you got a new loan from a lender or refinanced, you might have made a payment of mortgage points to a lender. Using a form known as a 1098, you can see how much money you paid in mortgage points and discuss how to use this as a deduction on your taxes.

Conclusion

Overall, there are many different ways that being a homeowner can benefit you when it comes to tax season. These are your mortgage interest, mortgage insurance, property taxes, mortgage points, and certain home improvements or renovations. Talk to your tax professional about how to get a tax break for buying a house and other tax benefits of owning a home!