March 31, 2011

Is Home Mortgage Interest Tax Dedudctible

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Now that the deadline for income tax filing is looming, many homeowners are asking, “Is home mortgage interest tax deductible?”  The good news, amid all the negativity of the state of the real estate market, is that mortgage interest is still tax deductible.  That means the tax benefits of owning a home can be substantial.  For example, homeowners would be able to save about $3,500 on federal taxes, based on a $200,000 30-year, fixed-rate mortgage with an interest rate around 4.5%.

As with all tax matters, it is wise to consult the IRS publications, and for more complicated matters, a financial advisor, accountant, or tax attorney.  But in the vast majority of situations, there is no mortgage interest deduction limit.  In addition, tax credits for energy efficient home improvements can mean more savings for homeowners.

Aside from the tax benefits, home ownership can provide a sense of security, leading to a positive investment in the welfare of the neighborhood and larger community, and still represents one of  the best investments  in the future well-being of  an individual or family.

Posted by:  Janet Giovannetti

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