One of the best benefits of being homeowners on the tax actions that you can take. For mortgage interest deductions, private mortgage insurance, points, energy efficiency credits, and even upgrades to your home you can still get a great deal of your taxes. If you used one of the mortgages for the self-employed you still have even more tax benefits that you can reap! Here we’re going to talk about everything you need to know to get the most off of your taxes this year. let’s get started, and see what you qualify for.
Property Tax Reductions
Did you know that most of your property taxes are deductible? It’s true! One of the best things about paying property taxes is that you will actually have to pay them. It’s a little strange to have a tax-deductible tax, but that’s how it goes.
Everything from local taxes to federal taxes can be deducted on your tax return. Depending on how much you make, where you live, even what sort of taxes you pay will affect the amount that you’ll finally have to pay on your taxes and how much you can deduct. This is different for every province.
Energy Efficiency Credit
The Canadian government rewards those of us that want to save energy, and you’ll be able to save a lot on your taxes if you’ve been doing some energy efficiency upgrades. Adding solar panels, energy efficient appliances, even brand new windows can help you save big on your taxes. Each province has its own rules for energy-efficient credits, so you want to check your jurisdiction for more information.
Some regions even allow you to energy efficient credits for changing your old fluorescent light bulbs to the new CFL type bulbs; not only will this help you save in your taxes, but also help you save on your energy bill too!
Private Mortgage Insurance
If you currently paying PMI, or private mortgage insurance, the interest on this can be tax-deductible. if this is the first year that you’re paying private mortgage insurance, you may actually be able to deduct the payments you’re making for your mortgage insurance. This is great, especially when you’re a new homeowner! Every little bit helps, so make sure you talk with your financial advisor or mortgage lender to see if this applies to you.
Any interest paid to a first mortgage, a second mortgage, even home equity lines of credit can be tax deductible depending on your situation. Sometimes, like with private mortgage insurance, your actual payments may be tax-deductible. This all depends on how much you pay, where you live and what your income is. If you’re not sure how this applies to you, call for tax help or have a chat with your accountant.
One of the best things about being a brand new homeowner is all the tax deductions that you can take. Make sure that you are maximizing your tax reductions, and enjoy your brand new home.
Erin Thompson is a mortgage broker and financial blogger for Homebase Mortgages. HBM is a Toronto mortgage broker that provides bad credit mortgages, mortgages for the self employed, home equity loans, debt consolidation, secured lines of credit, private mortgages, second mortgages. You can visit their website at http://www.homebasemortgages.ca/