Make sure to keep track of the mortgage interest pay because all of this interest is deductible even if one has been paying interest on a second home.
Chicago, IL (PRWEB) February 22, 2015
There are plenty of perks of homeownership, including a greater number of tax benefits. During tax season, homeowners should take advantage of tax breaks that could save them money. To successfully file their taxes, homeowners should maintain proper documentation of their finances and what they've spent so far on their homes.
The Federal Savings Bank has compiled the following tips for homeowners to save money during tax season:
Benefit from home office deductions
One of the tax breaks homeowners can use is a home office deduction. Homeowners may either run their businesses from home or telecommute to work, requiring an office setup in their houses. With a home office, one can deduct a certain percentage of home expenses, from the utilities to home repairs and maintenance. The IRS reported the average office deduction is an estimated $3,000.
Keep track of mortgage interest
With homeowners potentially paying thousands in interest over the course of their mortgages, they could reduce the money paid toward their home loans by deducting their mortgage interest. Taxpayers can use this tax break no matter the mortgage type, from the home's first mortgage to a home equity loan or line of credit. Make sure to keep track of the mortgage interest pay because all of this interest is deductible even if one has been paying interest on a second home.
Use the correct forms
Homeowners should ensure they use tax forms for the correct year and avoid using the 1040EZ because they are not itemizing, which could save them money. The correct forms for homeowners will likely be Form 1040 and Schedule A to list their expenses that are tax deductible during tax season.
Contact The Federal Savings Bank, a veteran owned bank, to learn more about mortgages.