But WHY are you talking to me about *taxes*????
Owning a house is cool. It’s even COOLER when it comes tax time! There are several potential tax deductions you can take when you are a homeowner.
Y’all know I am NOT a tax attorney, so of course, you should always consult with your tax-friend on any tax related matters.
Now let’s get to the saving money part:
1) Deduct the interest you pay on your mortgage. This one is especially useful in the first 5 years of your loan, when the majority of your payments are going to interest instead of principle. Granted, individuals are allowed (in 2017) a standard deduction of $6,300 per year, but with our hefty Seattle home prices, I can imagine you are likely to have paid more than that in mortgage interest alone. It may seem easier to take the standard deduction, but you choose to itemize you can save money. Your lender will send you a 1098 Form that will have the info you need to deduct your mortgage interest.
2) Your property taxes! Most of you are paying $5,000+ in property taxes each year, even if they are wrapped into your monthly mortgage payment. Since you are already itemizing your deductions to take advantage of the mortgage interest, you can throw in your property taxes as well for additional savings.
3) Closing costs! If you bought your home in 2017, you can deduct some of the fees associated with the purchase. The most common deductible item is any points that you paid on your mortgage.
Save that money kids! You can use it to upgrade your bathroom or save for a new roof 🙂