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New Member

If you don't own any another property, including primary residence, can you get tax break on a "2nd home"?

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New Member

If you don't own any another property, including primary residence, can you get tax break on a "2nd home"?

You may be able to deduct property taxes and mortgage interest on a home that is not your primary residence, if you itemize your deductions.

In addition to itemizing, these conditions must be met for mortgage interest to be deductible:

  • The loan is secured by your main home or a second home. "Secured" means the home is put up as collateral to protect the lender.
  • The home with the secured loan must have sleeping, cooking, and toilet facilities.
  • You or someone on your tax return must have signed or co-signed the loan.
  • If you rented out the home, you must have used the home at least 14 days during the tax year or 10% of the number of days you rented it out, whichever is greater.

Mortgage interest is usually reported on Form 1098, Mortgage Interest Statement. After you enter your 1098 in TurboTax, we'll ask a series of follow-up questions to make sure you're qualified to take the deduction.

You may be able to deduct property tax as long as you only use the property for personal use, and also itemize your deductions. Deduct it for your: Main home, Vacation homes, Land, Foreign property.

You may not get a "tax break" on the gain from the sale of your property, that is not your main home.

You won’t pay taxes on the first $250,000 (also known as a gain) you make from the sale of your home. If you file jointly, you won’t pay taxes on the first $500,000. 

That income is free and clear as long as

  • You owned the home
  • It was your main home for two years or more within the five years leading up to the sale
  • You waited at least two years between selling your primary home and excluding your first $250,000 or $500,000 from taxes. In other words, you may buy and sell as many primary homes as you'd like, but you'll only get this tax benefit every two years.  

When you sell a second home, the tax situation is different. Here's that info.

TurboTax will show you if your home sale is taxable, but you’ll need to upgrade your account to TurboTax Premier. Ready to upgrade and enter your home sale info? Follow these steps:

Open (continue) your return in TurboTax. If you’re not sure you’re in your return, click the orange Take me to my return button. 

  1. In the upper right corner, search for home sale and then click the "Jump to" link in the search results.
  2. Answer Yes to "Did you sell or have your home foreclosed in 2016?" 
  3. You’ll be asked to upgrade to TurboTax Premier. Confirm your upgrade.  
  4. Follow the screens to enter your info.  


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