5 Taxbreaks for Homeowners

Posted By on January 11, 2012

With tax season in full swing and tax day just around the corner, homeowners are looking for breaks for being a homeowner. Chances are purchasing a home is the largest purchase one will make in a lifetime. In today’s economy, everyone is looking for ways to save money and taxes can be a large chunk! Tara-Nicholle Nelson from REThink Real Estate compiled a list of top Tax Breaks for Homeowners.

1)    Mortgage Interest Deduction. If the home is used for your personal residence, 100% of the mortgage interest you own and pay before December 31st, 2011, is deductible on your 2011 taxes. You will receive a form from your lender outlining this number.

2)    If you are a new homeowner in 2011, chance are you paid some Advance Interest on your home loan at closing, this is also deductible. You can find this information on your HUD-1 statement, which you should have received at closing.

3)    Property Tax Reductions. Again, assuming that this home is your primary residence, you should be able to deduct 100% of the property taxes you’ve paid to your state and/or local taxing agency during 2011.

4)    Closing-Cost Deductions. Discount Points and origination fees paid to your mortgage lender or broker at closing are frequently deductible. However there are rules around this so make sure to ask your tax professional for help to make sure you meet these guidelines. NOTE: According to the Internal Revenue Service Publication 530, “You cannot deduct transfer taxes and similar taxes and charges on the sale of a personal home.”

5)    Home Improvements. There are various home improvements that you can receive state and local tax credits for. This is especially true with items that increase your homes energy efficiency. For instance homeowners who install geothermal systems may be able to claim up to 30% of the installed cost in tax credit in the year the system is placed into services with no cap on the credit. Solar panel systems you can receive a 30% credit of the cost with no cap limit. For a list of all of tax credits you can receive for energy efficiency visit The US Department of Energy’s Website.

As always, it’s recommended that you consult a tax professional or use a reputable tax software program when looking for tax deductions. This ensures you receive all the tax breaks you are eligible for, as well as reduce the chances for an audit by the IRS.

 Potterhill Homes is the leader in the Greater Cincinnati area for energy efficient building. Not only are all of their homes extremely energy efficient, they have been successfully able to build a Net Zero home. A Net Zero home is when the actual cost is offset by the income generated from selling Solar Renewal Energy Credits back to the power company and by the end of the year you utility bills are net zero. For more information on net zero homes and energy efficient homes visit Potterhill homes website or call Potterhill Homes today 513-248-4428.

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About the author

Katie has been with Potterhill Homes for over 3 years. She works on the technical side at Potterhill Homes, maintaining the website and assisting in Marketing Campaigns. She Currently resides in Cincinnati where she enjoys shopping and watching sports.

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About Potterhill Homes

Cincinnati-based Potterhill Homes is a premier builder of affordable, environmentally friendly homes in Greater Cincinnati. Our homes are built with traditional Cincinnati architectural styles and are perfect for both urban infill and suburban development. To learn more about Potterhill Homes,visit www.potterhillhomes.com.


About the authors

Katie has been with Potterhill Homes for over 3 years. She works on the technical side at Potterhill Homes, maintaining the website and assisting in Marketing Campaigns. She Currently resides in Cincinnati where she enjoys shopping and watching sports.