Details for Times News Promotions - Ad from 2021-04-04

Tax Deductions = Big Savings
It’s tax time
again, with all
the dread or joy
(depending on
your situation)
that brings. But
if you sold your
home recently
or will sell it
soon, there are
big savings
to be had with
tax deductions
for buyers and
sellers.
Realtor.com
recently sat down
with tax experts for
an overview of the
main deductions
summarized in
this article. Be
sure to consult
with your local tax
professionals and
take advantage of
these deductions
when you sit down to
do your taxes.
Selling coStS
If you’ve lived
in your home for
at least two of the
previous five years
before the sale and
the home is your

principal residence
— not an investment
property — you can
deduct any costs
directly associated
with selling the
home. These include
legal fees, escrow
fees, advertising and
commissions.

deductible, at least
for the period of you
owned the home.
Rules on these
deductions are
more complicated,
so check with your
tax professional for
details.

property
improvementS
taxeS
and repairS
Property tax
Renovations,
deductions are
upgrades and repairs capped at $10,000,
are all deductible.
according to tax
Any improvements
experts, but must be
or repairs you make fully paid up until the
in order to sell
home is sold.
your home can be
capital gainS
deducted as selling
Capital gains are
costs long as they
profits from the sale
are made within 90
of the home, so
days of closing, say
they are technically
tax experts.
an exclusion
mortgage
not a deduction.
intereSt
After paying
Interest on your
your expenses
mortgage is also
and outstanding

mortgage debt, the
cash left is taxed
as income. But you
can exclude up to
$250,000 of the
capital gains from
the sale if you are
single, $500,000
if you are married.
Again, you need
to have lived in the
home for the past
two of five years.
Once significant
bonus is that these
gains are based on
what’s known as
cost basis, which is
whatever amount
you purchased the
home for plus any
amount you spent on
improvements, for
example. A $300,000
home with $50,000 in
improvements could
be sold without
paying any capital
gains taxes.
Remember, tax
laws and rules
change fairly
frequently as news
administrations do
away with previous
rules, so it’s always a
good idea to review
all these possibilities
with your local tax
consultant.

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