Buy Down Your Interest
Purchasing deductible points are a standard tax break every year. It is easily done by talking with your banker or mortgage broker. It knocks your interest rate down by about .25% for each point you purchase, and you will also be able to receive a tax deduction for what you pay for that interest rate buy down.
Here’s how it works. One point usually costs 1% of your loan amount. It’s paid at closing and you receive about .25% reduction in your interest amount for that deduction. Here’s an example: Let’s say you are getting a loan for $175,000, 30 year mortgage and your interest rate is 3.8%. Buying 2 points could reduce your interest rate to 3.3% and will cost you $3,500.
Get A Break With Energy Credits
- This may be the year to get some energy saving systems in place. See the Residential Renewable Energy Tax Credit, which lets you write off 30% of the cost of some energy saving systems.
- Geothermal heat pumps
- Solar panels, solar water heaters
- Fuel cell property
- Wind turbines
There are some exceptions but definitely worth looking into it if you have ever considered some of these alternatives.
No More Renting (which offers no tax breaks)
If you rent, you aren’t getting any home related tax benefits. Additionally, you are very likely paying more per month for a house that would cost less on a month to month basis to own vs rent.
Your Architect. Your REALTOR®.
Sage Leaf Group, Silvercreek Realty Group