What deductions can I claim on my new home purchase?

January 28, 2015 by Dave Du Val, EA
house on top of a green hill

Hey Dave,

My wife and I bought a townhouse in 2014. What tax deductions can we take?

Jeremiah

 

Jeremiah,

Congratulations to you and your wife on the purchase of your new townhome. You may deduct any mortgage interest you paid, which will be reported to you on Form(s) 1098 from the lender(s). You may also deduct any points you paid on the loan origination; these amounts will be shown on your final escrow statement, which is sometimes called a settlement statement or HUD-1.  Also deductible are real estate taxes that you paid in 2014. If you paid qualified mortgage insurance premiums (and if your income is below a certain level), those would be deductible too. Most of the other expenses relating to the purchase are either adjustments to your basis (what you paid for the home plus improvements you make) or not deductible.

I do hope that you and your wife enjoy your new townhome for many years to come.

Deductibly Yours,

Dave

 

Recent Articles

small child on swing
Simply stated, child support is not deductible. However, it is worth noting that identifying child support payments may not be so simple.
Closing Costs
Real estate closing costs can be pesky things. And since you are paying for them, can you at least deduct them from your taxes?
Tax Deduction written on a sticky-note
Tax deductions and credits serve the same purpose − to reduce the amount of a taxpayer's tax owed. The way that each serves this purpose is different.
speedometer
In 2019 self-employed taxpayers can deduct their car expenses at the standard rate of 54.5 cents per mile driven for business. However, most employees cannot.

SEARCH

 

David E. Du Val, EA
Chief Compliance Officer for TRI Holdco

 

Dave Du Val, EA, is Chief Compliance Officer for TRI Holdco. Inc., the parent company of TaxAudit, and Centenal Tax Group. A nationally recognized speaker and educator, Dave is well known for his high energy and dynamic presentation style. He is a frequent and popular guest speaker for the California Society of Tax Consultants, the California Society of Enrolled Agents and the National Association of Tax Professionals. Dave frequently contributes tax tips and information to news publications, including US News and World Report, USA Today, and CPA Practice Advisor. Dave is an Enrolled Agent who has prepared thousands of returns during his career and has trained and mentored hundreds of tax professionals. He is a member of the National Association of Tax Professionals, the National Association of Enrolled Agents and the California Society of Enrolled Agents. Dave also holds a Master of Arts in Education and has been educating people since 1972. 


 

Recent Articles

small child on swing
Simply stated, child support is not deductible. However, it is worth noting that identifying child support payments may not be so simple.
Closing Costs
Real estate closing costs can be pesky things. And since you are paying for them, can you at least deduct them from your taxes?
Tax Deduction written on a sticky-note
Tax deductions and credits serve the same purpose − to reduce the amount of a taxpayer's tax owed. The way that each serves this purpose is different.
speedometer
In 2019 self-employed taxpayers can deduct their car expenses at the standard rate of 54.5 cents per mile driven for business. However, most employees cannot.
This blog does not provide legal, financial, accounting, or tax advice. The content on this blog is “as is” and carries no warranties. TaxAudit does not warrant or guarantee the accuracy, reliability, and completeness of the content of this blog. Content may become out of date as tax laws change. TaxAudit may, but has no obligation to monitor or respond to comments.