Tax Benefits of Home Ownership

What owning a home can mean for your taxes.

tax benefits of home ownershipTaxes. It’s usually a dreaded word that fills everyone with trepidation around April 15. But did you know home ownership is actually one thing you can do to lighten this burden? Tax benefits of home ownership are almost too good to be true. The Internal Revenue Service will look down on you favorably! REALTOR.com shares the best tax benefits.

Your tax breaks come full circle in the lifecycle of home ownership, and it all begins at the purchase.
The IRS says you can deduct interest in the year that it is paid, and that is usually part of each monthly loan payment. In addition, if the day you purchase is on any day other than the first of the month, you will likely pay a charge for “daily interest” between the day of closing and the end of the month. Look on line 901 of your HUD settlement statement.

The IRS also says that, in most cases, loan discount points and origination fees are tax deductible to the buyer, regardless of who pays them. Look at lines 801 and 802 of your settlement statement and see if you hit the jackpot. This is a particularly unusual deduction because you get the benefit even if the seller paid your closing costs. And because origination fees of 1 percent and more are common, this can amount to a lot of cash.

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Benefits of Homeownership

Reasons why you should own a home.

Homeownership has countless health and social benefits.
Homeownership has countless health and social benefits.

Benefits of homeownership extend past the short-term excitement of receiving your keys from the REALTOR. Homeownership is an investment and allows for independence. The effects of a steady home environment are even longer-lasting than many know and its effects are widespread. These benefits spread from individual homeowners to society as a whole. What are you waiting for?

Who does homeownership benefit?

Children
Children of homeowners are more likely to graduate from high school and score higher on standardized tests than the children of renters. This in turn results in increased chances of getting into college, better-paying jobs,  and overall long-term success.Read More »

5 Social and Health Benefits of Homeownership

Homeownership has health and social benefits for families.
Homeownership has health and social benefits for families.

Moe Veissi, past president of the National Association of Realtors and a Realtor® for 40 years, pointed out the benefits of owning a home beyond tax reductions at the 2013 Capitol Conference. Some reasons to buy a home as opposed to renting are obvious. Homeownership is an investment and allows for independence. The effects of a steady home environment are even longer-lasting than many know and its effects are widespread.

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