Tax Benefits in Owning a Home

Before a home owner curses the troubled housing market, he or she should take solace in the U.S. tax code, which makes buying a home a good deal for almost everyone.

Here are some reasons why:

• Mortgage interest deductions- in some cases including mortgage insurance premiums, reduce home owners' tax liability by reducing income.The deductions can be used on both first and second home mortgages.



• Interest on home equity loans are also deductible.



• Profits from the sale of a home can potentially be tax free* (* when a primary residence is sold the profits are tax free up to $250,000 for single home owners or $500,000 for married home owners filing. Any profit above this usually is a long term capital gain at 15%- less if the seller's tax rate is less than 20 %.

Tax laws change, please contact your tax attorney or accountant for specific tax questions.