Real Estate Second Home Tax Advantages Reviewed By

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A new article from Loan Love takes a look at some of the tax advantages that those owning more than one home can be benefiting from. is a borrower advice website that is dedicated to helping borrowers find home loans that they will love. With first class information, valuable resources and connections to top rate industry professionals, the website has quickly become a trusted destination for current news and expert loan advice. A newly released article on Loan Love continues to provide borrowers with the information that they need to take full advantage of homeownership by reviewing the real estate second home tax advantages that are currently available.

This new Loan Love guide titled, Real Estate Second Home Tax Advantages In a Nutshell, starts by saying, “Congratulations! You’ve decided to take the plunge and buy that second home you’ve always dreamed about. Whether you are purchasing a long-awaited vacation home, seasonal residence or an investment property to bring in some additional income, there are some tax breaks coming your way that can help make ownership of a second home more affordable. The first thing to keep in mind about tax breaks for a second home is that different tax rules will apply depending on how you use your property:

  •     personal use;
  •     rental income; or
  •     combination of the two.”

The article goes on to explain that if the homeowner has purchased a second home as vacation home or second residence, then they should be able to deduct the mortgage interest they are paying on that home come tax time, just as they are able to do with their primary residence. This deduction applies for homes that have a combined debt less than $1.1 million across both homes. Owners of second residences may also deduct their property taxes, however they will not be able to write off expenses such as utilities or upkeep unless they can prove that the property includes an office that is devoted to their business.

Tax rules for second homes used for rentals are a bit more complex. The Loan Love second home tax advantages guide states,

“Less straightforward are the tax rules that apply to your second property if you are renting it out. Although more complex, the tax rules that apply can generally be applied according to the number of days your property is rented out each year. If your property is rented out for 14 days or less during the year, you do not have rental income as defined by the tax laws. The house is still considered a personal residence, so you can just go ahead and deduct mortgage interest and property taxes like you would with your primary residence. But if you end up renting out the property for more than 14 days, you will need to report rental income. On the other hand, you also have the opportunity to deduct rental costs. However, expenses must be allocated between the portion of time the property is rented and the portion it was used personally.”

The Loan Love guide gives more details on the tax rules that apply for rentals and homes used as combination rental/vacation homes and ends off by saying, “There are other limitations. Real estate losses are considered “passive losses” by tax law, meaning they usually are not deductible. But, if your adjusted gross income is less than $100,000, you can deduct up to $25,000 in losses each year to offset other income, such as your salary. If your income tips over the $100,000 mark, that $25,000 allowance evaporates. You can, however, store passive losses and use them later on to offset taxable profit when you eventually sell that second home.”

For more information on the tax advantages available on second homes, click here to view the full article on

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Kevin Blue
Loan Love
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