What Tax Deductions Can You Take As A First-Time Home Buyer?

If you buy a home in the next year, do you know what type of tax deductions you might be able to benefit from this time next year? Three common deductions can greatly help come tax time. If you are a first-time home buyer and your total itemized deductions exceed the standard deduction set for your filing rate and age, you could be able to deduct mortgage interest, mortgage points, and property taxes. Also, you might qualify for energy credits, sales-tax deductions, and mortgage interest credits too! It’s certainly smart to use an online tax service or an accountant to get the most tax benefits you can the year that you purchase your house.

Mortgage Interest/Mortgage Points (Form 1098)

Your lender will send you a Form 1098. This form details how much you paid in mortgage interest. It saves a bunch of calculations, because it already includes the amount you paid at closing. This is one of the biggest deductions for a first-time home buyer. It will also tell you the points you paid. The cool thing is that, even if the seller agrees to pay the points for you, you can still claim them as long as you pay at least that much towards the equity of your home this year.

Property Taxes

Property taxes  are also deductible, but the deduction only covers the taxes paid during the time when you actually own the home. If you paid the sellers back taxes as part of the purchase agreement, you can’t claim those. You also can’t claim local assessments for things like installation of sidewalks or sewage lines on your property.

Are You Ready to Move?

If you’re interested in moving to a community near Jasper, Indiana, check out our listings. Become familiar with the area. Before you start shopping for a home in Indiana, it’s a good idea to explore areas you might like to live in — that way you can get a feel for what properties are available and how much you’ll need to spend. We’ll help you find homes for sale in the most beautiful parts of Indiana.

On the other hand, if you’d like to sell your Jasper-area home, we’d love to help with that too! Call us at 812-634-6969 or get in touch with us online.