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Homeownership Tax Benefits
Mention taxes, and most people are immediately stressed. Mention tax benefits, however, and you will probably get a happier reaction. This is great advantage to homeownership. Along with being an investment, homeownership can help you save money by offering tax break via certain itemized deductions from your income tax. Talk in more detail to your tax professional about these benefits.
Interest paid on a home loan. Interest that is paid on a first mortgage, second mortgage, home improvement loan, or a home equity loan can be tax deductible. First, the deductions are limited to a maximum of two mortgaged residences. This may be a primary residence and one other property, such as a vacation home. Rental and business properties are not considered in this limit of two. The next limitation is the amount of the debt.
In order to take advantage of homeowner deductions, you must file Form 1040 and itemize your deductions on Schedule A. However if you itemize your deductions, you cannot take the standard deduction. If the standard deduction exceeds the homeowner deductions, you may want to claim that one instead. You should consult your tax advisor for the best way for you to file.
Continue reading for more information on “Taxes and Insurance” that you will need to know about in order to be better prepared for a California Mortgage Loan!
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