Since personal income tax was introduced by the 16th amendment in 1913, U.S. taxpayers have enjoyed specific tax benefits for home ownership, the American Dream, right? While tax benefits might not be the only reason that motivates a person to buy a home, they are still tangible and not available to renters.
The exclusion of capital gains tax on the profit made from a home is unique from other investments and provides owners significant savings. Single taxpayers can exclude up to $250,000 gain and married taxpayers up to $500,000 gain. During the five-year period ending on the date of sale, a taxpayer must have: owned the home for at least two years; lived in the home as their primary residence for at least two and have used the address accordingly as it pertains to filing their income tax. Gain on the sale of a principal residence in excess of the allowed exclusion are taxed at the lower long-term capital gain rate of the owner.
A homeowner may take the standard deduction or itemized deductions in any tax year based on which will create the largest deduction. Property taxes and qualified mortgage interest are allowable itemized deductions.
For more information, see your tax advisor or see IRS Publications 523, Selling Your Home and 936, Home Mortgage Interest Deduction. For additional information locally, Bond Bookkeeping and Tax is located in Henderson at: 50 W. Pacific Ave, Henderson, NV 89015 (702) 471-6511 and they take walk-ins. Feel free to call with questions and ask for Don.
You can still take advantage of low interest rates, tax benefits and have independence thru home ownership - call today and let's get started.
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Kim Duclos Elite Realty
702-521-3939
