5 Things All Homeowners Need to Know About Their 2018 Taxes

For 2018, the biggest change for homeowners under tax reform is the itemized deductions some homeowners can claim. You can deduct a maximum of $10,000 ($5,000 if married filing separately) in personal property taxes, real estate taxes, plus income and sales taxes combined. In the past, these taxes have generally all been fully tax-deductible (no cap). This means that a homeowner with property taxes over $10,000 will not be able to deduct the full amount.

It used to be that you could deduct the amount of loan interest up to $1 million dollars. (Anyone that was a homeowner prior to December 15, 2017, is grandfathered into that cap.) But for anyone who purchased a home after that date, the new limit on the home mortgage interest deduction is $750,000 in acquisition debt.

Say you took out a home equity loan after the sale to help offset the costs of buying, building or substantially improving your new place. The new tax laws no longer allow you to write off the interest on these loans—making them less advantageous to take out if you can pay in cash.

Unless your home is located in a federally declared disaster area, you can no longer deduct the amount of any losses you endured during the year. (This also goes for casualty and theft losses.) The only exception is if you conduct business out of your home. In that case, disaster, casualty and theft-related expenses are still a deduction you can take.

Airbnbing your beach house? Unlike your primary residence (for which you do not have to claim rental income), if you rent out your second home for more than two weeks a year, you have to report it on your return. However, you can get tax breaks in the form of maintenance costs related to rental expenses: meaning stuff like supplies, repairs and furniture.