Homeowners Should Be Wary of These Common Tax Deduction Mistakes

When you file your taxes, you use the Schedule A form to list your deductions. If you double-check these 6 common missteps, brought to public attention by HouseLogic, you will save yourself an IRS headache and possibly even some money.

1. Line 6: Double check the amount you are actually paying for local real estate taxes, the money you send the lender can be a different amount than what taxes they actually pay on your behalf.

2. Line 6: If you bought or sold a home this year, be careful not to list the property taxes as if you owned the home for the entire year. Use property tax amount listed on your HUD-1 closing statement to reflect the accurate numbers.

3. Line 10: There is a limit to the amount of points paid on a refinance that you can claim at one time, the total amount must be spread out over the amount of time you have the loan.

4. Line 10: There is a limit to the amount that you can claim from a HELOC, home equity line of credit.

5. Line 13: Double check your Private Mortgage Insurance loan-to-value status as well as the year you started paying on it. There have been changes in the law and you might even qualify to stop paying it!

6. Line 20: There are specific guidelines to claiming loss due to things like vandalism, fire, etc. Make sure you review them and consider hiring a professional to assist you.

For the full article by HouseLogic, read 6 Home Deduction Traps and How to Avoid Them
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