Home Ownership Tax Deductions

You know you can get a deduction for your mortgage interest, but what else can you deduct for your primary or secondary home?

At tax time, your house is not simply a home: it's a giant tax deduction. You get to deduct:

Your property taxes.
The mortgage interest on your primary residence, as well as any secondary residence you own. (There are limits, but relatively few taxpayers are affected.)
The interest on up to $100,000 borrowed on a home-equity loan or home-equity line of credit, regardless of the reason for the loan.
Points you paid when purchasing the house (or convinced the seller to pay for you).
For homes purchased in 2007, the premiums paid for private mortgage insurance in 2007. (The right to this deduction disappears as adjusted gross income rises from $100,000 to $110,000 on a joint return and from $50,000 to $55,000 on a single return.)
Home improvements required for medical care.

The actual amount of money you save on your annual income tax bill depends on a variety of factors, such as:

Your filing status (single, head of household, married filing jointly, married filing separately)
Your standard deduction
Your other itemized deductions
Your taxable income

Your home-related deductions plus your other itemized deductions must add up to more than the standard deduction, or they won't save you any money.

You can't deduct the following payments for your primary residence:

Dues to a homeowners' association
Insurance on your home
Appraisal fees for your home
The cost of improvements to your home. But keep those receipts: They may help you reduce your taxes when you sell your home.

Updated for tax year 2007