First time home buyer

[F M]

As year 1 of a first-time home buyer filing joint returns, what are the Tax forms I should expect and from whom? and what are the types of Federal and PA state tax deductions I should be making in my 2024 tax returns on the various expenses including mortgage interest, real estate taxes, closing costs, etc?

[xmasbaby0]

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.  

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

Go to Federal> Deductions and Credits> Your Home to enter mortgage interest, property taxes, and loan origination fees (“points”) that you paid in 2023.  You should have a 1098 from your mortgage lender that shows this information.  Lenders send these in January/early February.

It is very hard for a lot of people to use itemized deductions now that the standard deduction is so much higher.  Your home ownership may not have any effect on your tax due or refund, especially if you purchased the house late in the year.  

Standard Deduction

Your itemized deductions have to be more than your standard deduction before you will see a change in your tax owed or tax refund.  The deductions you enter do not necessarily count “dollar for dollar;” many of them are subject to meeting  tough thresholds—medical expenses, for example, must meet a threshold that is pretty hard to reach.  The software program uses all the IRS rules that apply to the expenses you enter, and it tells you if you have enough to use your itemized deductions or if using the standard deduction is more advantageous for you.  Under the new tax laws, some deductions have been capped—there is a $10,000 limit to the itemized deductions for state, local, property and sales taxes. 

2024 STANDARD DEDUCTION AMOUNTS

SINGLE $14,600    (65 or older/legally blind + $1850)

MARRIED FILING SEPARATELY $14,600    (65 or older/legally blind + $1500)

MARRIED FILING JOINTLY $29,200    (65 or older/legally blind + $1500)

HEAD OF HOUSEHOLD $21,900    (65 or older/legally blind + $1850)

[F M]

Thanks, this was the kind of answer I was looking for.

Besides the prepaid and postpaid interest, property tax and loan origination fees, are there any more items that could qualify?

Also, should I expect a Tax Form from the authorities telling me about the total amount of the various taxes I paid during 2024 or do I need to total them up using the payments I made during the year?

And are property taxes, school tax, country taxes, etc all included and deductible up to the $10k limit ?

[xmasbaby0]

SALT------that includes all state and local taxes--- so, yes, that would be your property taxes, school taxes, local taxes, etc.   that are capped at a $10K deduction.

No.....your home ownership deductions include what was already provided to you-----mortgage interest paid, property tax paid, and perhaps loan origination points.