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Level 1

Question

Tax savings going forward

Forum|Forum|3 years ago
November 16, 2022
1 reply
8 views

We are paying every year about 3000 in back tax. Is buying a home a smart idea to lower or eliminate that tax?

Level 6

Hello there!

There are definitely some tax benefits that you may be able to get due to home ownership, but the exact benefit that you will get depends on your personal tax situation. I cannot confirm that buying a home will eliminate your balance due.

You may be able to deduct the following expenses against your income but you can only get a benefit if your listed/itemized expenses exceed the standard deduction.

mortgage interest
property taxes
mortgage insurance
points

Here are some resources that you may find helpful.

https://turbotax.intuit.com/tax-tips/home-ownership/buying-your-first-home/L5QxJLcQT

https://turbotax.intuit.com/tax-tips/tax-deductions-and-credits/tax-deduction-wisdom-should-you-itemize/L8Ln7K0Gp

You may also want to consider adjusting your W4's or paying estimated taxes to minimize the balance you owe at the end of each year.

https://www.irs.gov/individuals/tax-withholding-estimator

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