3 Homeowner Tax Breaks You May Overlook

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                                                                          Freedigitalphotos.net By: Stuart Miles

Tax time can be stressful for many homeowners and some deductions may be missed. Here are three deductions that homeowners may be eligible for that often times are not taken advantage of.

• State and local tax breaks for green improvements: Many homeowners invested in improvements in their home which are energy efficient. These improvements range from dual paned windows, tankless water heaters, low flow plumbing appliances, solar panels, insulation, etc. It may be worth it to locate your receipts for these investments and to check with your tax person or your local government to see what deductions you are eligible for.
• Mortgage interest tax deduction: Many people cite the benefits of mortgage tax deductions as an important benefit sought after when buying a home. It is surprising that only 63% of homeowners actually itemize their tax deductions, which is necessary in order to take advantage of mortgage interest tax deductions.  Some may feel that it is too much work to itemize deductions, but with a little effort you may be pleasantly surprised at the result.
• CODI income-tax exemptions: Mortgages that have been defaulted on and forgiven through foreclosures, short sales, deed in lieu of foreclosure, or settlement with partial payment are considered part of the tax payer’s income. This type of income is called Cancellation of Debt Income or CODI. If you were a homeowner that closed a short sale or settled a defaulted home loan last year, you may qualify for a tax advantage that is worth checking into.