Even though owning a home comes with some significant expenses, some of them are tax-deductible. With many people looking for ways to lower their income tax, there are a few expenses tied to the house that every homeowner should consider. This could make a significant difference in their final tax bills, and it could lead to a large tax refund.
Before delving into tax-deductible home improvements, it’s important to understand that these tax deductions won’t be applied immediately. In most cases, homeowners can only benefit, tax-wise, from their home renovations later, when they sell their home.
One of the challenges you will face when deciding how much money to put down on your new home is whether to put down a larger down payment or to take a bit of money from your down payment and use it to buy “discount points” to lower your interest rate.
When the chatter was at its peak on the 2018 tax law changes being proposed, one of the big areas of concern for homeowners was the elimination of the mortgage interest deduction. Right behind that issue was a similar treatment with regards to property tax deductions.