The Tax Benefits of Owning a Home: Must-Know Deductions and Secrets
If you own a home, make sure you don’t miss any tax deductions
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Home deductions benefit filers because they can minimize overall liabilities while also maximizing potential refunds. Keep reading to learn more about the types of tax breaks you can take as a homeowner, along with some of the must-know deductions.
For most homeowners, taking a standard deduction instead of an itemized deduction is the best option.
Jump to insightYour filing status will affect the maximum amount you can deduct.
Jump to insightSeemingly unrelated expenses, such as a home office and medically necessary improvements, can also be deductible.
Jump to insightWhat is a home deduction?
A home deduction is a type of tax deduction that’s available to homeowners. The deduction lowers taxable income, and it’s based on certain expenses incurred while owning and maintaining a home. In order to qualify for any home deductions, the home must be your primary residence.
Some examples of home deductions include mortgage interest, property tax payments and qualified home improvements.
Types of home deductions
There are two different types of deductions: standard deductions and itemized deductions.
- Standard deduction: A standard deduction is a lump-sum deduction available to you, with the sum variable based on your filing status.
- Itemized deduction: An itemized deduction is a series of deductions — variable in value and limits — based on individual items and expenses relating to your home.
Filing itemized deductions will generally require more work than filing for standard deductions, such as storing records and receipts for up to six years. However, there are no limits on the number of itemized deductions that a filer can take. Also, you can only file one type of deduction, so you can’t claim both a standard and itemized deduction.
Deductible vs. non-deductible home expenses
If filers choose not to take the standard deduction or are not eligible, itemized deductions are still available. If you choose to file itemized deductions, you’ll need to fill out the Internal Revenue Service’s (IRS) Schedule A and file it with Form 1040.
Many tax deductions are available to homeowners, but there are limits to how much homeowners can deduct.
Deductible home expenses
Homeowners can deduct:
- Mortgage interest
- Property taxes
- Mortgage points
- Medical and dental expenses
- Charitable contributions
- Business use of your home or car
- Business travel expenses
- Work-related education expenses
- Casualty, disaster and theft losses
Non-deductible home expenses
Homeowners can’t deduct:
- Home repairs
- Utilities, including water, gas, electric and internet
- Homeowners insurance, including fire and title insurance
- Homeowners association (HOA) fees or charges
- Forfeited deposits, down payments or earnest money
- Most closing costs and settlement costs
- Amount applied to reduce mortgage principal
- Wages for domestic help
- Depreciation
» RELATED: Are home equity loans and HELOC interest tax deductible?
What affects your home deduction?
Your filing status is the principal variable that affects your home deduction. Without knowledge of your filing status, you may end up deducting too much, resulting in some tax issues with the IRS.
The IRS recognizes these filing statuses:
| Filing status | Description |
|---|---|
| Single | Unmarried, divorced or legally separated taxpayer |
| Married filing jointly | Married taxpayer filing a joint return with their spouse |
| Married filing separately | Married couple filing separate returns |
| Head of household | Unmarried taxpayer who meets special requirements, such as paying more than half the cost of maintaining a home for a year or a qualifying person lived with you for more than half a year |
| Qualifying widow(er) | Taxpayer who has a dependent child and whose spouse died during previous two years |
Standard deduction limits by filing status for 2025 and 2026
Below is a chart comparing the standard deduction limits for tax years 2025 and 2026.
| Filing status | 2025 | 2026 |
|---|---|---|
| Single | $15,750 | $16,100 |
| Married filing jointly or qualified widow(er) | $31,500 | $32,200 |
| Married filing separately | $15,750 | $16,100 |
| Head of household | $23,625 | $24,150 |
Must-know tax benefits for homeowners
Tax deductions are just some of the tax breaks that homeowners enjoy. Some of the most popular itemized deductions include deducting mortgage interest and property taxes. Homeowners can also deduct mortgage points, which some people pay when they originally get their mortgage.
Here are some of the must-know tax deductions for homeowners:
- Home office: Home office expense deductions are available to people who use their home as their primary place of business and use the office space for work purposes.
- Medically necessary upgrades: Medically necessary home improvements can be tax deductible, such as constructing a wheelchair ramp or installing railings in a shower.
- Home improvements: Some states and jurisdictions offer tax credits for making home improvements that are energy-efficient, such as installing energy-efficient appliances or solar panels.
- Home sale: When selling a home, you may qualify for a capital gains exclusion of up to $250,000 for a single person or married couple filing separately, or $500,000 for a married couple filing jointly.
» RELATED: When is the best time to sell a house?
FAQ
What are the rules for deducting mortgage interest?
The rules for deducting your mortgage interest depends on when you first took out your home loan. On mortgages originated on or after Dec. 16, 2017, interest deductions are limited to $750,000 if you’re filing jointly or $375,000 if filing separately.
How do I deduct for owning a home if I’m a co-owner?
It’s best to speak with a tax professional for information about deductions you can take as a co-owner. Once you explain your circumstances, they can help you determine which deductions you can qualify for.
Can you write off your house insurance on your taxes?
Home insurance isn’t tax deductible for primary properties, though you can deduct home insurance for rental properties.
Bottom line
For most homeowners, taking a simple standard deduction is their best option. However, if you’re able to keep records and receipts pertaining to your purchases and payments, itemizing your deductions may prove to be a more financially beneficial decision. Whichever route you choose to take, the deductions you take should provide some benefit when tax season rolls around.
Article sources
ConsumerAffairs writers primarily rely on government data, industry experts and original research from other reputable publications to inform their work. Specific sources for this article include:
- Internal Revenue Service, “Publication 936 (2024), Home Mortgage Interest Deduction.” Accessed Dec. 7, 2025.
- Internal Revenue Service, “Publication 530 (2024), Tax Information for Homeowners.” Accessed Dec. 7, 2025.
- Internal Revenue Service, “IRS Releases Tax Inflation Adjustments for Tax Year 2026, Including Amendments From the One, Big, Beautiful Bill.” Accessed Dec. 7, 2025.
- Internal Revenue Service, “About Schedule A (Form 1040), Itemized Deductions.” Accessed Dec. 7, 2025.
- Internal Revenue Service, “Publication 523 (2024), Selling Your Home.” Accessed Dec. 7, 2025.
