Many do not take advantage of home tax deductions. Tax advisors will tell you this is because homeowners aren’t even aware that these deductions exist.
Homeowners can claim several write-offs that will lower their taxes.
You and your spouse can deduct for mortgage interest payments up to a millions dollars. Your mortgage debt must be secured. Both first and second home qualify.
- Mortgage Points
- Profits on Selling Your House
- Property Taxes
The situation changes if this second home is rented out. If the property is rented for fourteen days or less annually, the rental income does not have to be declared. If it is rented for more than fourteen days, the rent must be declared for the year.
However, if the rent must be declared because it was rented for fourteen or more days, the owner can claim such rental expenses as: mortgage interest, property taxes, insurance, property management fees, utilities, and half of the depreciation.
4. Boats loan interests
Do you have a boat? If it has eating, sleeping, and bathroom facilities, it may qualify as a first or second home. You could deduct mortgage interest paid on the loan for the purchase of your boat. Check this out with a tax consultant.
- Home Depreciation