Carmen Cotto-Rivera
Real Estate Broker Salesperson

"Love Where You Live, and Live Where You Love"

Vylla Home 
office: 856-206-0413

Cell:  201-835-5650

NOW LICENSED IN PA!!!!

CARMEN COTTO-RIVERA

ESPAÑOL   

   "Love Where You Live, and Live Where You Love"

Vylla Home - office: 856-206-0413

cell:  201-835-5650

Paragraph

NOW LICENSED IN PA!!!!

Real Estate Broker Salesperson

Write-Offs Uncle Sam Wishes You’d Forget

Write-Offs Uncle Sam Wishes You’d Forget

As a homeowner, you can benefit from tax breaks that can shave thousands of dollars off from your IRS bill each year, which could mean a higher refund check.  Since it’s that time of year we are all gathering our documents and working on getting our taxes in asap, I wanted to remind you about what owning a home can do to help your tax situation.  

And if you currently rent, becoming a homeowner means you’ll get some tax benefits that could make you “like” filing your tax return.

Read over the list below to see what could pertain to your situation. There are other deductions you might be able to take that I haven’t listed here, so be sure to always consult with your tax advisor.  This isn’t tax advice, just a reminder of what to talk to your accountant about!

  • Mortgage interest.  If your home was purchased before Dec. 16, 2017, you can deduct the mortgage interest paid on your first $1 million in mortgage debt. For mortgages taken out since that date, you can deduct the interest on the first $750,000. You’ll want to talk with your accountant about whether it’s better to deduct the mortgage interest or taking the standard deduction instead. The standard deduction is currently $13,850 for single filers and $27,700 for married taxpayers filing jointly.  If you decide to deduct the mortgage interest, you’ll need to itemize your income taxes in order to claim this. Don’t just fill out the 1040-EZ without doing the math first to see whether itemizing or the standard deduction will result in the lowest tax billor highest refund – for you.

Property Taxes. Property taxes on all real estate are fully deductible. When you buy a home, check the settlement (closing day) sheet to see if you reimbursed the seller for property taxes, he or she prepaid for a period you actually owned the home. If so, include that amount in your property tax deduction.

  • Credit for Green Improvements. If you make qualified energy-efficient improvements to your home after January 1, 2023, you may qualify for a tax credit up to $3,200.  The credit equals 30% of qualified expenses including things like energy efficient exterior doors and windows, insulation, and air sealing materials, and even things like air conditioners and heat pumps.  To learn more go here or check with your tax preparer.
  •  Investment Property/Rental Property. The cost of maintaining and marketing a rental property can be deducted from the income the property generates, without regard to the owner’s tax status. These expenses include mortgage interest payments, insurance, utilities, maintenance, repairs, advertising costs and management fees, as well as the non-cash cost of depreciation.

Home office. You can deduct the costs of a home office that you use exclusively as your principal place of business.  This one is notorious for causing audits, so if you are going to claim this one, but sure to talk with your accountant about your situation and whether you qualify. 

  • Tax-Free Rental Income. If you rent out your own home for 14 or fewer days during the year, the rental income is tax-free.
  • Capital Gains:  Remember, if you sold your principal residence,  you may not have to pay tax on the gain.  The IRS typically allows you to exclude up to $250,000 of capital gains on real estate if you’re single and $500,000 of capital gains on real estate if you’re married and filing jointly.  If you are selling an investment property, that’s where it gets a little more complicated, but you could do a 1031 exchange to avoid paying capital gains on that sale as well.  If learning more about that interests you, reach out to me and we can talk more, and I can also recommend a 1031 expert who can answer all your questions about this program.

So, there you have itsome basic information to help you to the most advantage of being a homeowner when it comes to your taxes.  But I’m no tax expert, so be sure to talk to your accountant, CPA, or whoever is preparing your taxes—they will know best based on your personal situation. 

And, if you don’t have an accountant and want to use one this year, I have one I can recommend.  Just reach out to me and I’ll get you in touch.  The only question now is, how are you going to spend that big refund check?  I’d love to know!  😊

What You Need To Know Before Buying Your First Home!

Hi, there!

I'm Carmen and I love helping first time home buyers, including Spanish speakers,  buyer their first home.  I also love helping sellers looking to move up or downsize to their next home.  Let me know how I can help you make your real estate goals come true. 

Let's Meet

Contact

201-835-5650

921 Pleasant Valley Av
Suite 200
Mt. Laurel, NJ  08054

ccr@ccrsellsrealestate.com

Buyers:  tips and advice on buying your first home

My Listings (and their stories)

Sellers: tips on home maintenance and prepping your home for sale 

Blog

schedule your free consultation

Hi, there!

I'm Carmen and I love helping first time home buyers make their first home more affordable and I love helping sellers looking to move up to their forever home. Let me know how I can help you make your real estate dreams come true. 

schedule your free consultation

Buyers:  tips and advice on buying your first home.

My Listings (and their stories)

Sellers: tips on home maintenance and prepping your home for sale 

Blog