It’s easy to be swayed by all the negativity swirling around in the real estate industry.Â However, home ownership offers benefits you just can’t get from other forms of investment, regardless of market conditions.Â In particular, the US tax code makes buying and owning a home a great deal.
First, you can deduct from your income the interest paid on your mortgage.Â That applies to second homes, too.Â You may even be able to deduct your loan’s insurance premiums.Â If you’ve taken out a home equity loan, that interest is also deductible, regardless of how you’ve used the money.
If you’ve sold or plan to sell your home, profits up to $250,000 (or $500,000 for married couples) are free from taxation.Â While some restrictions apply, you won’t get that kind of bargain on the sale of stocks, bonds, or other investments.
Now to get back to that mortgage interest deduction: it’s almost guaranteed that if you hold a home loan, the interest deduction will help you reach the threshold for claiming all sorts of other itemized deductions above and beyond the standard amount allowed.
So just simply owning a home puts you in the happy position of being able to claim myriad other deductions from your taxable income.Â Real estate agents are not tax advisers, but they recognize a good deal when they see one!
Bennington VT Real Estate, Buying