One of the many perks of homeownership is big tax breaks. So whether you’re doing your taxes yourself or getting help from a professional, it’s important to take advantage of those breaks!
Homestead Exemption: Filing for a Homestead Exemption is a good idea because it reduces the taxable value of your home, saving you money during tax time. In many counties throughout Georgia such as Cherokee and Cobb, you must have owned and lived on the property as of Jan. 1st. You may also be required to file with the city if your property is located within city limits.
Mortgage Interest Deduction: Before buying a home, a standard deduction may have made the most sense when you prepared your taxes. But homeowners can deduct the interest portion of their mortgage payments, and the earlier you are in your mortgage, the greater the percentage of each payment that goes toward interest, so take advantage right away!
Home Office: There are specific criteria that have to be met in order to deduct home office expenses, but it can lead to a very large deduction. In general, your home office has to be used specifically for business purposes. Check with a tax professional to see if your home office qualifies for a deduction—it’s a little extra work, but can make a big difference in your tax responsibility.
Moving Expenses: Federal tax laws allow you to deduct your moving expenses if your relocation is related to starting a new job or a transfer to a new location for your present employer. To qualify for the deduction, your new work location must be at least 50 miles from your old home and you must begin working shortly after you arrive.
As a reminder, it is a good idea to keep these documents handy when filing this year:
- Warranty Deed book and page
- Proof of residence (such as mail, pay stubs, utility bills, etc.)
- Social security number
- Driver’s license
- Vehicle registration information
- Form 1098 (mortgage interest statement)
- Moving expenses & receipts
For a comprehensive checklist of forms and documents to aid in preparation of taxes, visit the IRS website.
Basic Requirements for Homestead Exemption:
Must be legal resident of the county; and
Must own and occupy home as of January 1 of the year the homestead exemption is sought.
Deadline for Filing Homestead Exemption:
In most counties, the application must be filed by March 1 of the year the exemption is sought, but some counties have a later deadline.
How Long will the Homestead Exemption Last?
The Homestead exemption will remain on the property until there is a change in ownership.