How to Navigate Real Estate Taxes and Maximize Your Tax Benefits
Real estate taxes are an inevitable part of homeownership, but understanding them can help you save.
- Property Taxes: Vary by location, calculated based on the assessed property value. Check local rates before purchasing.
- Mortgage Interest Deduction: Homeowners can deduct mortgage interest on loans up to a certain limit.
- Capital Gains Exemption: If you sell a primary residence, profits up to $250,000 (single) or $500,000 (married) may be tax-free.
- Energy Efficiency Credits: Tax credits are available for installing solar panels or energy-efficient windows.
- Tax-Deferred Exchanges: Investors can use 1031 exchanges to defer capital gains taxes by reinvesting in a similar property.
- Home Office Deduction: Remote workers can deduct expenses for a dedicated workspace.
Work with a tax professional to ensure you maximize your deductions and credits.
