New Home Tax Deductions

what tax deductions or credits are there for new home owners for 2008?

the deductions you can now get pertain to itemizing. you can deduct your mortgage interest and real estate taxes and points on your mortgage. you can also deduct some closing costs.
the only credits that might be availiable are if you installed energy saving windows, etc..

2009-01-06 08:20:06 by Ericka G

www.harborfinancialonline.com First Time Purchase, New Home Buyer Tax Break 2010, 2011

I bought a home in early 2007 and Im wondering, what are the things I can deduct on my first home? Can I deduct the points I paid for the loan? Property tax I paid when I bought the house and property tax I paid for the 2008 year? Can I deduct home improvement costs?

Thanks
ps. I am single and live in California …. If that matters

First off, congrats on your purchase.. As to what you can deduct.. Points can be deducted if they weren't financed through your mortgage.. (ie., if you paid cash for the points at your closing you can deduct them in the year they were paid)... However if you financed them through your mortgage they will be prorated as part of your mortgage, So, each year you receive your 1098 INT from the company or bank that holds your mortgage, you will be deducting a prorated portion of the points.. You get to deduct the interest you paid on the outstanding mortgage , property taxes and homeowners insurance (also on your 1098 INT if your bank or finance co pays them for you) in the year you made them... You list all these deductions on your Sched. A (which since it is a federal tax form it doesn't matter that your're from California.. In most states however these deductions do carry over to your state return, if you file one..
Improvements usually become part of your basis in the property, Which means that when you sell your property your gain (capital gain) becomes less then if the improvements weren't made.. (ie, your selling price less (the price you paid for your home + any improvements) = capital gain)..
However for the last few years you have been able to receive a credit for certian energy efficient improvements in the year made. These include eneregy effecient windows, insulation, solor panels and a few other improvements.. You can check it out on IRS.gov

2008-02-17 20:14:27 by Triemferent

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On my taxes this year, I have noted the mortgage interest, the property taxes, and of course claimed an existing homeowner tax credit through our state taxes (we're not first-time buyers).

What about other deductions? Isn't a home a big-ticket item that could be used on the sales tax portion? (The closing costs seemed to be alot of fees, but not many "taxes") Any ideas?

Thanks!

having the home mortgage and taxes usually allows taxpayers to deduct more than their standard deduction and is a benefit in that it more effectively reduces your taxable income
you don't pay sales tax when buying a home

2010-02-05 18:02:29 by Dave G

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I bought a home last year and so far I've put about $10,000.00 in it in improvements: a new high efficiency central air & heating system, vinyl replacement windows, and then your basic paint, paper, trim, etc. Is any of this stuff tax deductable? I know I can deduct my mortgage interest, but what else home related? Anything? lol

You should be able to deduct any approved energy efficient Appliances.

2009-01-15 10:09:06 by Kel

I have a small part time photography business. Last year I had $10,000 deposited into a business account to start my own business. I purchased some very expensive equipment. during 2006. However I did no paid work. On last years return I stated no income and no deductions for my sole proprietor portion of the return. This year things seem a little more favorable. I actually have a booking for a job and my business is now fully liscensed. How do i factor in my expensive purchases from a prior year? Any advice will be appreciated. Thank you
Sorry i meant i filed no deductions/income for the year 2005

You would capitalize your equipment and depreciate it over its useful life. Use its fair market value for depreciation purposes. Lets assume you bought equipment for $10,000 in 2006 used exclusively for business. The equipment has a useful life of 7 years. If you use an accelerated method of depreciation, you would write off the equipment over the next 7 years as follows:
2006 - $2,449 (24.49%)
2007 - $1,749 (17.49%)
2008 - $1,249 (12.49%)
2009 - $893 (8.93%)
2010 - $892 (8.92%)
2011 - $893 (8.93%)
2012 - $446 (4.46%)

If you had income in 2006, you would be able to elect Sec. 179 and expense the equipment in the same year. So if you had $15,000 net income in 2006, you would have been able to write-off the equipment of $10,000 and be left with a net income of $5,000.

Note that if you only used the equipment for 75% business use, you would only depreciate 75% of the cost of the equipment, or $7,500.

2007-03-20 23:31:03 by sumastorm