The US tax season officially runs from Jan. 31 to April 15. Take this chance to itemize your taxes in order to take advantage of deductions and credits. If you own a single family home, condo, apartment, or mobile home, you may be eligible for some of these deductions.
What are the advantages of owning a home during tax seasons?
There are many advantages of owning a home during tax season. One of them includes being eligible for multiple tax deductions!
Mortgage interest deduction
You can deduct all of your home mortgage interest. The amount you can deduct depends on multiple factors, such as when you took out the mortgage, the amount of the mortgage and how you use the mortgage proceeds. You also have the chance to qualify for a mortgage interest deduction if your second home is a boat or RV with cooking, sleeping and bathroom facilities.
Deduction of property taxes
You are eligible for this deduction as long as you own a home, condo, or apartment. You can deduct your state and local property taxes based on the value of the real property. The only instance where you cannot claim this deduction is if you have your money held in escrow for the purpose of paying property taxes.
Home office deduction
There is a simplified version to figuring out the deduction for business use of homes in 2013. Homeowners and renters can take advantage of this deduction, as long as the space serves as the primary place of business. You are entitled to $5 deduction per square foot of the home being used for business, up to 300 square feet.
However, the regular method to obtain the home office deduction for this tax year still works. You would need to determine the actual expenses of your home office. This includes mortgage interest, insurance, utilities, repairs and depreciation.
There is a separate energy savings deduction available for you if you have installed a solar energy system, geothermal heat pump or small wind turbine in your home in 2013. You may claim up to 30 percent of the installation cost for tax credit. This credit does not apply to rental properties.