How to Calculate Tax Savings on Owning a Home

Video Transcript

"Calculating the tax savings of owning a home can be a pretty easy thing to do. I'm Richard with the Richard Blake Homes team in Tampa, Florida and I'm here to explain how you can calculate the tax savings of owning a home. The good news is that the IRS will allow you to deduct the interest you pay on your monthly mortgage. As well as, use the closing costs that were involved when you purchased your home. You'll want to contact your real estate agent or your closing company, your local lawyer, who ever it was that close on the property when you purchased it. Ask them for a copy of the Hud statement, the closing statement. This is going to itemize your closing costs. And you can use these costs as a deduction for this year's taxes. The next thing that you're going to do for next year actually, keep track of how much interest you're paying on a monthly basis. Generally you can find this on your monthly mortgage payment. They're going to itemize it and break it down how much you're paying in interest, how much you're paying towards your principle. Once you know how much interest you're paying, you're going to calculate that or add that for the entire year. And this number can actually be deducted from your taxes that year as well. Quite a bit of saving for you depending on what tax bracket you're at, that number is going to differentiate quite a bit. Okay? I'm Richard Blake in Clearwater, Florida. I hope that helps you calculate how much money you can say with using your home as a tax deduction. Thank you and have a great day."