Tax Deductions for Home Ownership

We pay income taxes based upon our income. However, with real estate, we're able to deduct a few items, which means we pay less in income taxes. If a person owns real estate, the following items will be tax deductible expenses for most of us. The first one might be mortgage interest. Mortgage interest is tax deductible if a taxpayer itemizes their real estate deductions.  A second item that is deductible are real estate taxes. Again, if you itemize your deductions, you can go ahead and claim real estate taxes as a tax deductible item and pay less income taxes. The third item that can help save on taxes is depreciation, but this is only on investment property such as rental houses. A person cannot depreciate their own home for a tax write-off. However, a person can depreciate an investment in rental properties or commercial properties if they’re for an investment business use and the depreciation, which means you're able to write off the cost of the acquisition. That will be tax deductible over a certain period of time, which once again means you pay less in income taxes.

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