Did you own or purchase new homes in Hagerstown MD in 2013? Along with the joys of DIY house projects, the freedom you never have as a renter, and pride of ownership that comes with owning your own home, there’s one more perk you’ll appreciate this time of year: tax deductions. As a homeowner, you can deduct many home-related expenses that equal big savings. Take a look at what you can and can’t deduct to get the most tax advantages on your property.
What is eligible for a deduction and/or credit?
• Property taxes, including taxes you may have reimbursed the seller for
• Mortgage interest on your primary and secondary residences
• Interest on up to $100,000 borrowed on a home equity loan or home equity line of credit
• Points paid when you purchased houses for sale in Maryland or those the seller paid for you
• Premiums paid for Private Mortgage Insurance (PMI) issued after 2006
• Home improvements required for medical care
• Energy-efficient upgrades like insulation, windows and doors, solar electric systems, high-efficiency heating and air conditioning systems, hot water heaters and more
• Actual expenses of home office used for business purposes exclusively and on a regular basis (new for the 2013 tax year)
What is not eligible for a deduction and/or credit?
• Home improvements or repairs not required for medical care
• Appraisal fees
• Closing costs on new homes and principal payments on your mortgage
• Depreciation of your home
• Local assessments to increase the value of your neighborhood
• Homeowners’ association fees
• Home insurance
How much can I save?
This depends on a number of factors, including your filing status, standard deduction amount, itemized deductions and taxable income. Coldwell Banker Innovations recommends consulting a professional for financial advice on your taxes, investments and other income-related matters.