Contact

Are Real Estate Closing Costs Tax Deductible?

  • Jun 29, 2022
  • Real Estate
are closing costs tax deductible

Are Real Estate Closing Costs Tax Deductible? The Answer May Surprise You
 

Closing costs are a major expense when buying or selling a home. These costs can include everything from the real estate agents commission to title insurance. But are these costs tax deductible? The answer may surprise you! In this blog post, we will discuss the tax implications of real estate closing costs. We will help you determine whether or not you can deduct these expenses on your taxes. Let's get started!

Are All Closing Costs Tax Deductible?

The simple answer is no, not all closing costs are tax deductible. However, there are some closing costs that you can deduct on your taxes. These include:

  • Property Taxes: If you are purchasing a home, you can deduct the property taxes that you paid at closing.
  • Prepaid Interest: If you are paying interest on your mortgage, you can deduct the amount of interest that you paid at closing.
  • Mortgage Points: If you pay points to get a lower interest rate on your mortgage, you can deduct those points on your taxes.
  • Origination Fees: If you are paying an origination fee to your lender, you can deduct that fee on your taxes.
  • Mortgage Insurance Premiums: If you are paying mortgage insurance, you can deduct the premiums that you paid at closing.

Closing Costs That Aren’t Tax Deductible

Not all closing costs are tax deductible, however. Some common closing costs that are not tax deductible include:

  • Appraisal fees
  • Credit report fees
  • Home inspection fees
  • Title insurance
  • Attorneys fees

Final Thoughts

Purchasing a home is a major financial decision. Be sure to speak with your accountant or tax advisor to determine which closing costs you can deduct on your taxes. This will help you save money when you file your tax return.

We hope this blog post has helped you understand the tax implications of real estate closing costs. If you have any further questions, please feel free to contact us. We would be happy to help!

Hello! I'm Jay Thomas, a REALTOR in Houston, Texas. Chances are you and I share a similar passion, Real Estate! I also have a passion for building businesses, working out, inspiring others, technology, sports, and people. Connect with me on Facebook and Instagram!

Resource: Har Blog

Hello! I'm Jay Thomas, A REALTOR in Houston, Texas. Chances are you and I share a similar passion, Real Estate! I also have a passion for building businesses, working out, inspiring others, technology, sports, and people. Connect with me on Facebook and Instagram!

Related Blog

Real estate investments
Young, Rich Americans: Building Wealth Through Leverage
  • Feb 04, 2023
  • Real Estate

Rich young Americans have a range of investment options beyond stocks. Real estate has been an increasingly appealing alternative for investors looking to diversify their portfolio, and Houston, Te...

read more
home renovation roi
Home Renovation with the best Return on Investment
  • Feb 04, 2023
  • Real Estate

When considering home renovation projects, it's important to think beyond what looks great and also consider the potential return on investment. Real estate experts suggest that certain upgrades of...

read more
maximize rental income
Maximize Your Rental Income
  • Feb 04, 2023
  • Real Estate

For those who are looking to maximize their rental income, there are certain strategies that can be applied to help get the most out of your real estate investment. Read more....

read more
are home improvements tax deductible
Are Home Improvements Tax Deductible?
  • Jan 28, 2023
  • Real Estate

It’s no secret that finishing your basement will increase your home’s value. What you may not know is the money you spend on this type of home improvement could also help lower your tax bill wh...

read more
real estate cash flow
6 Proven Strategies for Mastering Your Cash Flow
  • Jan 28, 2023
  • Real Estate

Knowing how to effectively manage and track cash flow is essential for any real estate business. Here are six proven strategies for mastering your cash flow. Read more....

read more
Real estate agent houston, Luxury real estate agent houston
Your Guide To Timing Your Home Buying and Selling - Should You Wait or Buy First?
  • Jan 26, 2023
  • Real Estate

Buying and selling a home can be an exciting yet intimidating. With the right timing and knowledge, however, you can make informed decisions to benefit you in the long run. Jay Thomas is the real e...

read more