People always say that it’s great for your taxes to own a home, but do you know why and what exactly those benefits are for you? See below for six great ones to keep in mind as you make your way through your real estate journey!
6 key tax benefits to owning a home:
1. A deduction of up to $750,000 worth of mortgage interest.
2. A SALT (state and local real estate taxes) deduction up to $10,000.00.
3. Tax-free rental income of 2 weeks if you rent your home out for 2 weeks per year.
4. A $250,000 tax-free capital gain deduction for singles and $500,000 for couples upon selling.
5. If you buy your home for $500,000, and it is worth $1 million when you die, your heirs' cost basis re-sets at $1 million and you bypass the capital gains on the initial value gain.
6. The current tax law allows you to take a tax deduction of $5 per square foot, for up to 300 square feet of office space. You can get a maximum deduction of $1,500.