Tax Return Depressing? Owning a Home Could Help

Many Americans got some depressing news this week; either their tax return was not as large as they had hoped or, in some cases, they were told they owed additional money to either the Federal or State government or both. One way to save on taxes is to own your own home.

According to the Tax Policy Center’s Briefing Book -“A citizen’s guide to the fascinating (though often complex) elements of the federal Tax System” – there are several tax advantages to homeownership.

Here are four items, and a quote on each, from the Briefing Book:

1. Mortgage Interest Deduction

“Homeowners who itemize deductions may reduce their taxable income by deducting any interest paid on a home mortgage. The deduction is limited to interest paid on up to $1 million of debt incurred to purchase or substantially rehabilitate a home. Homeowners also may deduct interest paid on up to $100,000 of home equity debt, regardless of how they use the borrowed funds. Taxpayers who do not own their home have no comparable ability to deduct interest paid on debt incurred to purchase goods and services.”

2. Property Tax Deduction

“Homeowners who itemize deductions may also reduce their taxable income by deducting property taxes they pay on their homes.”

3. Imputed Rent

“Buying a home is an investment, part of the returns from which is the opportunity to live in the home rent-free. Unlike returns from other investments, the return on homeownership—what economists call “imputed rent”—is excluded from taxable income. In contrast, landlords must count as income the rent they receive, and renters may not deduct the rent they pay. A homeowner is effectively both landlord and renter, but the tax code treats homeowners the same as renters while ignoring their simultaneous role as their own landlords.”

4. Profits from Home Sales

“Taxpayers who sell assets must generally pay capital gains tax on any profits made on the sale. But homeowners may exclude from taxable income up to $250,000 ($500,000 for joint filers) of capital gains on the sale of their home if they satisfy certain criteria: they must have maintained the home as their principal residence in two out of the preceding five years, and they generally may not have claimed the capital gains exclusion for the sale of another home during the previous two years.”

Bottom Line

We are not suggesting that you purchase a house just to save on your taxes. However, if you have been on the fence as to whether 2017 is the year you should become a homeowner, this information might help with that decision.

Disclaimer: Always check with your accountant to find out what tax advantages apply to you in your area. 

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37780 W Olivo Street Maricopa, AZ 85138

$489,000

3 Beds

2 Baths

2,002 SqFt

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Price Type --

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10307 W Chaparral Drive Sun City, AZ 85373

$489,000

3 Beds

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1,827 SqFt

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21172 E Camina Plata -- Queen Creek, AZ 85142

$489,000

4 Beds

2 Baths

1,953 SqFt

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Queen Creek Golf Course Community! This home 4 beds/2 baths features a spacious, open floor plan & Vaulted ceilings. All new LG Appliances. The expansive primary suite boasts a generous walk-in closet and ensuite bathroom with separate tub and shower, as well as a toilet room. French doors lead to the private backyard, which includes a covered patio, mature landscaping, a delightful lemon tree, roses, and a small grassy area. Exterior repainted in 2018, HVAC-2015, new hot water heater-2022, and updated tile flooring in bathrooms and patio areas. Custom all brass door knobs, handles and locks on doors. The Las Colinas Golf Club, a ''residents only'' recreational center provides tennis and pickleball courts, & fitness center. Close to dining, shopping, medical, and professional services!

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40723 W Olney Avenue Tonopah, AZ 85354

$489,000

6 Beds

2 Baths

2,433 SqFt

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2845 N 104th Avenue Avondale, AZ 85392

$489,000

4 Beds

2 Baths

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20018 N 18th Drive Phoenix, AZ 85027

$489,000

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2 Baths

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This lovely 4 bedroom, 2 bathroom home has been remodeled throughout. Step inside and be greeted by the eye catching wood burning fireplace and beautiful kitchen with new cabinets, appliances, counters and appliances. New flooring, paint, and light fixtures throughout. Both bathrooms have been tastefully remodeled with easy access showers, new cabinets, counters and fixtures. The trendy Arizona room leads you to the lush backyard with an expansive patio. The fresh pool decking and sparking blue pool are sure to catch your eye. Additional upgrades include new furnace, new a/c, new plumbing and updated electrical. Put this home on your MUST see list.

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4863 W Picacho Drive Eloy, AZ 85131

$489,000

2 Beds

2.5 Baths

1,884 SqFt

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Welcome Home to this very popular and sought after Mandera model in Robson Ranch! This partially furnished 2-bed, 2.5-bath home with a den/office spans 1884 sq ft with 18'' tile flooring throughout. Enjoy the airy feel with 11' ceilings in the main living areas and 10' ceilings in the master bedroom. The kitchen is a chef's dream, the dining area includes a built in China hutch and the master suite offers a luxurious retreat. Enjoy the warm Arizona sun in your private backyard oasis, which includes a covered paver patio with a ceiling fan, Pre-wired for a patio TV and Pre-wired electrical for a Hot Tub. Robson Ranch's Gated Community amenities, include an 18 hole championship golf course, pickleball courts, clubhouse, restaurant, heated pool, indoor lap pool, fitness center and more add to the vibrant lifestyle you will enjoy in this cozy community. See separate documents in documents tab for a list of items that will convey and also a list of features.

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17531 W Fetlock Trail Surprise, AZ 85387

$489,000

3 Beds

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Welcome home! This well maintained 3 bed, 2 bath residence boasts an expansive 2126sqft of living space and offers the perfect blend of comfort and functionality. Step into the heart of this home and discover an inviting open floor plan, seamlessly connecting the spacious living areas. Enjoy the eat-in kitchen featuring modern appliances and a warm, welcoming atmosphere for gatherings. Ideal for remote work or a game room, enjoy the convenience of not one, but two bonus rooms - providing the flexibility your lifestyle demands. The low-maintenance backyard is a blank slate ready for your vision. The 3-car garage is a car enthusiast's dream, equipped with LED lighting and epoxied floors for a polished finish the RV gate is perfect for your outdoor adventures. Nestled in the Desert Oasis Community, experience the harmony of suburban living while still enjoying easy access to local amenities.

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17844 W Sapium Way Goodyear, AZ 85338

$489,000

3 Beds

3 Baths

2,303 SqFt

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Property Type Single Family Residence

Price Type --

MOTIVATED SELLER!! WINDOW COVERINGS, CELLING FANS AND ALL APPLIANCES INCLUDED. MOVE IN READY! Absolutely beautiful less than 2 yrs. old home! 3-bedroom 3 bathroom with Office/Den. Inviting hallway leads to the captivating open floor design boasting fresh paint, tall ceilings, wood-look tile flooring, and sliding glass doors to the backyard w/Gas BBQ stub. Spotless kitchen provides SS appliances, recessed & pendant lighting, quartz counters, subway tile backsplash, a HUGE walk-in pantry, and a large island with a breakfast bar. The carpeted main retreat has a full bathroom with dual sinks and a walk-in closet, where extra insulation ensures year-round comfort and supreme soundproofing offers undisturbed peace. Secondary bedrooms enjoy a Jack & Jill bathroom. LAST OF THIS FLOOR PLAN. This is a stunning home located in a TOP RATED Estrella Mountain Ranch master planned community! This one level home features countless upgrades: Ceiling fans in all rooms, Blinds, screens on windows, Top of line Water softener, full Landscaping, Pendant lights, Fridge, Washer and dryer, living room tv mount and so much more. This home is considered a ''Smart Home'' - Garage, front door lock, security, thermostat, interior, and exterior lighting, are all automated. Smart Home compatible with Google, Alexa, and Apple. Kitchen features oversized island, quartz counters, and upgraded cabinetry. CAT 6 wired throughout. 240 AV installed in garage for your smart car. Home includes all appliances!! The open-concept layout and multiple windows allow natural light for bright and relaxing atmosphere. The backyard with low maintenance landscaping adds a touch of relaxation. Estrella community offers 2 exclusive clubhouses, welcome center, marina club, golf course, waterslides, 3 community pools, cooking classes, fitness, ballrooms & more! This home is a MUST SEE community with tons memories to start creating!!!

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$489,000

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Property Type Single Family Residence

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$489,000

3 Beds

2.5 Baths

2,304 SqFt

Status Active

MLS # 6668087

Property Type Single Family Residence

Price Type --

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$489,000

3 Beds

2.5 Baths

1,509 SqFt

Status Active

MLS # 6665827

Property Type Single Family Residence

Price Type --

This 3-bedroom, 2.5-bath Shea Home situated in the highly sought-after Clemente Ranch neighborhood. The spacious great room boasts vaulted ceilings and a neutral interior paint palette. The kitchen is a chef's delight with granite countertops, an island, ample cabinet space, stainless steel appliances, and recessed lighting. Upstairs, the master bedroom impresses with vaulted ceilings, dual sinks adorned with granite countertops, and a roomy walk-in closet. The secondary bedrooms feature laminate wood floors and ceiling fans. Step into the backyard oasis with lush grass, providing ample play space for both daytime and evening enjoyment. With its ideal location offering proximity to restaurants, shopping, and easy freeway access, this home is a must-see.

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