Second home mortgage

[bmshah1]

Last year we bought a condo <10miles from our primary home. The condo is a retirement home for my in laws. I'm wondering if I can deduct the following items for the condo:

1. Any purchase related expenses

2. Mortgage interest payments

3. Property taxes

4. HOA fees

[xmasbaby0 · Accepted solution]

You cannot deduct HOA fees or "purchase related" costs like closing costs.   You can enter mortgage interest and property tax that you paid in 2025 for your second home.

[bmshah1]

Do I mark it as a second home or an investment property?

[xmasbaby0]

@bmshah1 Which is it?   Who will be using the home?   Will you be renting it out and receiving rental income ---or will you and your family be using it?

[bmshah1]

It is primarily used for my in-laws. We are not renting it out currently. 

[xmasbaby0]

 Then you can deduct the same things you can deduct for your primary home.  You cannot deduct repairs, improvements  or HOA fees. 

Go to Federal> Deductions and Credits> Your Home to enter mortgage interest, property taxes, and mortgage insurance that you paid in 2025   You should have a 1098 from your mortgage lender that shows this information.  Lenders send these in January/early February or you may be able to import the 1098 from the lender’s website.

Home Ownership

There is not a first time home buyers credit on a Federal return. That ended in 2010. If your state has such as credit, you will be able to enter it when you prepare your state return.

Buying a home is not a guarantee of a big refund.  Your deductions for homeownership combined with your other deductions (if any) must exceed your standard deduction to change your tax due or refund. If you purchased your home late in the year, you do not even have a full year of home ownership deductions.

Your closing costs on your new home are not deductible except for prepaid interest, prepaid property tax or loan origination fees.  There are no deductions for appraisal, inspections, title searches, settlement fees. etc.

Your down payment is not deductible.

Your homeowners insurance for fire, hazard, flood, etc. is not deductible for your own home.

Home improvements, repairs, maintenance, etc. for your own home are not deductible.  (With possible exceptions for certain energy credits) (BUT——do make sure you keep careful written records/invoices, etc.  of any improvements you make to the home for someday when you sell it.)

Homeowners Association  (HOA) fees for your own home are not deductible.

@bmshah1

[bmshah1]

@xmasbaby0 thanks for such a detailed answer. Greatly appreciate it.