American Tax Service

Helping Americans File Their Taxes

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What is Capital Gains Partial Exclusion for Home Sale?

What is the Capital Gains Exclusion?

The capital gains exclusion is an IRS tax provision that allows you to exclude a certain amount of your capital gains from your taxable income. For example, if you have a capital gain of $10,000, you can exclude $3,000 of it from your taxable income.

Capital gain on a home sale is the difference between the selling price of your home and the original purchase price, plus any improvements you made to the home. The capital gains tax on your home can have a big effect on how much profit you ultimately bring in from selling your home and/or property.… Read the rest

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Tax Credits for New Home Construction

Are you building a new home?

There are tax breaks available for people in this situation. They come in the form of tax deductions and tax credits. A credit is used to reduce the amount you pay, and a deduction reduces your total taxable income.

Here are some of the tax write-offs available to you now.

Did You Pay Interest on a Construction Loan?

new home construction

If you took out a construction loan to build your home, then chances are you paid interest on that loan.… Read the rest

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What is the Home Office Deduction?

In order to claim the home office deduction, you must know the square footage of your entire home and your home office. Auditors do not usually make home visits. If you send them photos of your home office, that is usually all of the verification that they need.

Determine Which Method to UseHome Office Tax Deduction

Percentage of your home – This method allows you to calculate your home office percentage and then claim the home office deduction. You need to determine the square footage of your entire home and the square footage of your office.… Read the rest

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Is it Possible to Get a Tax Deduction on Your Home Equity Loan?

Can I Get a Home Equity Loan Tax Deduction?Can I get a home equity loan tax deduction?

The answer is you can still deduct home equity loan interest. But the rules have changed, and there are more limitations than ever before.

Interest on home equity loans has traditionally been fully tax-deductible. But with the tax reform brought on by President Trump’s Tax Cuts and Jobs Act (TCJA), a lot of homeowners are struggling to work out whether they can still take a home equity loan tax deduction.

This is now the first year the new rules will apply to their new taxes, despite the original act being passed in 2017.… Read the rest

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Home Energy Tax Credits

Tax season is going to be here before you know it. Therefore, now is the time to ensure that you have completed all of the energy-efficient upgrades to your home.

Having an energy-efficient home will save money on your bills and pay less money in taxes. Learn how you claim home energy tax credits if you qualify.

Non-Business Energy Property Credit

home energy tax creditsYou can get a 10% credit for your energy-efficient improvements. Things that fall under this category include:

  • Water heaters
  • Electric heat pumps
  • Central air conditioners
  • Natural gas, propane, or oil water heaters
  • Qualified oil furnaces
  • Qualified oil hot water boilers
  • Some air circulating fans
  • Insulation that reduced heat loss or gains
  • Exterior windows, skylights, or doors
  • Storm windows and doors
  • Solar panels
  • Metal and asphalt roofs that reduce heat loss or gain

Residential Energy Efficient Property Credit

This energy tax credit will allow you to have a 30% credit for the alternative energy equipment that you have had installed.… Read the rest