Buying Your First Home and Tax Time

Buying Your First Home and Tax Time in Charlotte

If you’re a first time home buyer, your new house for sale in Ardrey will likely work in your favor come tax day. The key is to educate yourself about the regulations and benefits associated with buying a home and prepare accordingly. Read on for details about buying your first home and tax time to take advantage of all the breaks available to you!

Mortgage Interest Tax Deduction

The mortgage interested deduction is one of the most valuable for the first time home buyer. Applying it takes more work to complete since you have to itemize. However, with the help of a tax preparer, you are sure to reap the benefits.

Simply make sure you have the Form 1098 from your lender, which details how much mortgage interest you paid.

An Approach to Property Taxes

It is required that you pay property taxes on an Ardrey home for sale each year. However, there are ways to make it easier financially. For example, instead of paying in one big installment, you can often split it into two payments.

Another avenue is to set up a mortgage escrow account and pay in monthly installments. While this increases your monthly payments, many homeowners find the smaller payments much easier to tackle.

Private Mortgage Insurance Tax Deduction

If you didn’t quite make it to the 20 percent mark on your down payment, you’re required to pay an additional monthly amount in private mortgage insurance. However, oftentimes this is tax deductible as well. Again, look for the Form 1098 from your lender to take advantage of this tax break!

Use Funds Wisely

Finally, with your biggest return being the mortgage interest tax deduction, remember to use this extra money wisely. For example, build an emergency fund or making improvements on an Ardrey house for sale that will increase its value.

What is your experience with buying your first home and tax time? We would love to hear your thoughts!