Tax Benefits of Ownership
One of the treasures of homeownership is that the IRS and most state governments allow you to deduct, within certain limits, mortgage interest and property taxes when you file your annual income tax return.
When you buy and own a home, your local government sends you an annual, lump-sum bill for property taxes. Property taxes are typically based on the value of a property.
Taxes and Profits
Profit is the difference between the price you pay to buy a home and the amount you receive when you sell it, less any capital improvements. There are also some great tax benefits you'll receive when you sell your house.
Required Tax Filings
This section covers the elements of filling out and filing your taxes after selling your house, including details on how to calculate your gains.
Exclusion and Taxable Gains
Thanks to the new capital gains rules figuring out how much, if any, of that gain is taxable is quite simple. This explains in further detail capital gains and the exclusion of certain housing sale profits.
Repairs v. Renovations
Work done on fixer-uppers falls into two broad categories - structural repairs and renovations. Structural repairs bring a property up to local health and safety standards. Renovations increase a fixer-upper's value by modernizing the home.