Tax season is right around the corner, so today, I want to highlight some potential tax breaks you should ask your tax professional about.
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Tax season is nearly upon us, so today, I wanted to touch on some of the lesser-known benefits of owning a home.
Let me start by saying that I’m not a CPA, and I recommend that you get your taxes done by a professional. These items are merely things you can bring to their attention to possibly write off on your 2016 taxes.
- Interest paid on your mortgage. Everyone knows about this one, but did you know in some cases, you can write off taxes on your taxes? If you pay state or federal taxes, you may be able to include them on your 2016 return.
- If you have made any improvements to your property for medical reasons, the cost may be a tax deduction.
- If you use a portion of your home for a home-based business, you can get an additional write-off. I know at least here in Utah, many people have things like a salon or a multi-level marketing business on the side. If you run a business out of your home, be sure to talk to your CPA about it because there is a healthy tax break you may be able to claim.
- If you purchased a home last last year, part of the expenses of purchasing that home are also items you can write off. You’ll need a copy of your settlement statement, but if you can’t find it, give your agent a call or go to the title company that closed the transaction.
- If you sold a home in 2016, you might not have to pay taxes on your profits. Did you own the home for more than two years? If you did own the property for more than two years, was it your primary residence, and if it wasn’t, did you at least occupy the home for two of the last five years? If you can answer ‘yes’ to both of those questions, odds are you won’t have to pay taxes on your home sale profits up to first $250,000 worth of profits if you’re single, or $500,000 if you’re married.
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If you use a portion of your home for a home-based business, you can get an additional write-off.
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Hopefully this is some good news for you! If you have any other questions, don’t hesitate to give me a call or send me an email. I’d love to help!
