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?
If you took out a construction loan to build your home, then chances are you paid interest on that loan.… Read the rest
Can I Get a Tax Deduction for Home Improvements?
Although home improvements cannot be deducted, they may be depreciated, which is especially relevant for homeowners and property owners in the business of renting or leasing, as it can impact their income.
This simply means you deduct the expenditure over a period of time ranging from three to two and a half years, depending on the state’s tax laws and any applicable exceptions.
It is essential to keep receipts and records of these projects and consult a tax professional for guidance.… Read the rest
Are you wondering if you’ll have to pay capital gains tax on your home sale?
Many people do not know that a large portion of homeowners who sell their homes can avoid capital gains tax on their home sales.
How Much is Capital Gains Tax on the Sale of a Home?
When selling your primary home, you can make up to $250,000 in profit or double that if you are married, and you won’t owe anything for capital gains.
The only time you will have to pay capital gains tax on a home sale is if you are over the limit.… Read the rest
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
You can get a 30% 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 reduces 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 installed.… Read the rest
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