: If you "bought down" your interest rate by paying points at closing, these are often fully deductible in the year you paid them, provided they meet specific IRS criteria. Ongoing Costs to Budget For
: Many lenders require you to pay a portion of your annual property taxes each month as part of your mortgage payment to ensure they are paid on time. Long-Term Tax Considerations
: Mailed by your lender annually to report mortgage interest. buying a house and taxes
: These are calculated based on your home's assessed value multiplied by local tax rates. It is highly recommended to check your specific County Assessor's website to estimate these costs before purchasing.
: While general maintenance isn't deductible, keeping receipts for major "capital improvements" (like a new roof or addition) can help increase your home's "cost basis," potentially reducing your taxable gain when you sell. Essential Documents to Keep : If you "bought down" your interest rate
: When you eventually sell your primary residence, you may be able to exclude up to $250,000 (single) or $500,000 (married filing jointly) of the gain from your income, provided you lived in the home for at least two of the five years before the sale. Find more details on IRS Topic No. 701 .
: Shows the final taxes and points paid at the time of purchase. : These are calculated based on your home's
: For verifying payments made outside of escrow. Topic no. 701, Sale of your home | Internal Revenue Service
