Tax Deductions Every First-Time Homebuyer Should Know
Buying your first home is exciting—and it can also bring some valuable tax breaks. If you bought a home this year, here are the key deductions that could reduce your tax bill and boost your refund.
1. Mortgage Interest Deduction
One of the biggest tax benefits of homeownership. You can deduct interest paid on mortgage debt up to $750,000. For most first-time buyers, this adds up quickly—especially in the early years of the loan.
2. Property Taxes
You may be able to deduct up to $10,000 in state and local taxes (SALT), which includes property taxes. Be sure to check what you paid during the tax year—this is a common deduction new homeowners miss.
3. Mortgage Insurance Premiums (PMI)
If you made a down payment under 20%, you’re likely paying PMI. The good news? That premium may be tax-deductible, depending on your income level and current IRS rules.
4. Points Paid at Closing
If you paid points to get a lower interest rate when closing your loan, those points might be fully or partially deductible in the year you bought the home.
5. Energy-Efficient Home Upgrades
Installed solar panels, energy-efficient windows, or a new HVAC system? You may qualify for a federal energy efficiency tax credit—a dollar-for-dollar reduction in what you owe.
Navigating the first year of homeownership can be overwhelming, but the tax benefits are worth exploring. At SuperNOVA Tax Solutions, we’ll make sure you take full advantage of every deduction and credit you qualify for.