Saving on Real Estate Taxes Without Deductions

Whether you own a home or have a large real estate investment portfolio, you are going to seek the best deductions to save money during the tax season. Real estate taxes may vary, depending on where you live, but finding tax credit to reduce your tax bill can often be a great help. Here are a few options to consider that are not your standard deductions.

Capital Gains

When you buy a home or real estate assets, it is likely going to appreciate over time. For many homeowners, one of their goals is for their investment to generate a profit. However, once you decide to sell an asset, keep in mind that the profit is going to give you a tax bill. The profits from the sale of an asset is what’s called a Capital Gain. A single person selling his or her personal home may qualify for at least $250,000 in capital gains. If you’re married, it is possible you will qualify for as much as $500,000. These gains don’t have to be reported on your tax return. However, if you decide to take advantage of these gains, you will be required to pass the Use and Ownership Test set by the IRS to determine eligibility.

Green Home Tax Credits

Installed any solar panels or energy-efficient materials on or in your home? Here is another area where you can score another huge real estate tax break. It doesn’t matter if you have solar panels or a tank-less water heater. The government has created tax incentives to stimulate the economy and encourage taxpayers to use green energy materials. Depending on what your state or local requirements are, you might find yourself eligible for this tax credit on your Green Home.

Investment and Business Tax Credit

Investment tax credits are applicable when you have made improvements to an energy-efficient home or asset. Real estate investors can also use Business Energy Tax Investment Credits. This is another aspect of the green home tax credits, but for larger scale investments. This type of credit is often applicable for both commercial and residential construction.

Insurance Premiums and Maintenance Credit

Those with real estate investments can use any expensive insurance premiums as tax break as well. These costs, and any maintenance costs that you have paid out for significant repairs, such as for replacing rotting wood or even painting a deck, are expenses that may be eligible for tax credit as well.

Owning a home or real estate investment can make tax season difficult to maneuver. Taking the time to research your local and state requirements can help uncover beneficial credits and deductions that could be right for your home or real estate asset. For more information about real estate taxes, or if you are seeking to buy or sell a home, contact The Damron Group, located in San Marcos, TX.

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