2010 Tax Deductions for Owning a Vacation Home
If you own a vacation home that is typically for personal use, you can lease for up to 14 days without being taxed on the rental income you received. If you want to rent your vacation home out for more than 15 days per year and can limit your yearly use to less than 10%, then you can benefit from using it as a rental home only income real estate which could possibly save you hundreds on your income taxes.
You can then be entitled to deduct utilities, homeowners fees, maintenance, repairs, and travel cost. There are also a few energy preserving tax credits you can take advantage of that include new windows and doors, insulation, roofing, water heaters, HVAC, and biomass stoves. Although there is little that you can do change the real estate tax rate that you will be assessed by your local tax authorities, you can challenge the assessment of value that was determined.
You should check the assessment letter for accuracy. Nashville real estate agents report many homes in their market are incorrectly assessed. You could have received by mail or you can find it on your local property assessor website. Make sure the amount of bedrooms and baths, sq ft, and acreage are accurate. If comparable homes in your area are being assessed for less, you may be able to get your value lowered.
Military personnel that served at least 3 months abroad from January 1st 2009 to April 30th 2010, then you can still take advantage of the home buyer tax incentive that is $8,000 if you have not owned a house in the last 3 years or $6,500 if you have ownedreal estate for 2 of the previous 5 years. In addition, if you have to move from the home you purchase within the next 3 years, provided it is more than 50 miles from your home, you will not have to repay the tax credit.
Posted by Carlos Sagastume on December 2, 2010. Filed under HUD Homes.
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