Owner-Occupied Tax Deductions Explained In New Loan Love Article

SAN DIEGO, June 22, 2013 /PRNewswire-iReach/ -- LoanLove.com, a new borrowers advice website founded just this April, has a mission to help consumers and borrowers alike in obtaining the latest information on mortgage lending trends, the real-estate market and the U.S. financial landscape for the purpose of helping them obtain a home loan they love. The new website is quickly becoming a trusted destination for current mortgage news and expert loan advice. The team at LoanLove.com is devoted to help empower both first time and experienced homeowners with valuable resources, first-class knowledge and connections to top-rated industry professionals. To fulfill this goal LoanLove.com is continually updating their website with new articles and guides; a recently posted one reviews some of the details of owner-occupied tax deductions.

The article explains the different tax benefits of property ownership, whether the property is owner occupied or an investment property. The Loan Love article says: "The tax advantages of any investment are largely dependent on the overall income of the property owner. While each approach offers some advantages, how ownership of either type of property will impact your bottom line is something you should discuss – and discuss carefully – with a financial advisor or tax professional."

The advice given in the article is just a simple guide for those who are wondering about what tax benefits each type of property ownership can bring. As the Loan Love guide points out, the primary tax benefit of owner occupied home ownership is that occupants can deduct both property taxes and mortgage interest from their income, which can have a significant impact on the total tax they pay. Another advantage of owner occupied property is that capital gains tax will not need to be paid when the owner sells the home, as long as the selling price is below $250,000 if the owner is single or $500,000 for couples filing jointly – that is a huge windfall for most homeowners. However, this can change if the owner has deducted the use of the home as a business.

Investment properties also come with a number of real estate tax benefits. First of all, while investment properties are not exempt from capital gains tax, investment properties that have been owned for more than a year or two usually are subject to lower capital gains taxes than other investments. In addition, investment property owners can defer payment of this tax if they sell the home and buy a new property of like kind within a certain time period; this is referred to as an "exchange".

Investment property owners will also have the benefit or being able to depreciate their rental property and certain items they provide with the property; in many cases, the depreciation they can deduct exceeds the home's actual decline in value. These properties can be part of a self-directed IRA (individual retirement account), which can help mitigate the tax burden of rental income.

These are just a few points that homebuyers should take into account when trying to judge the tax benefits of owner-occupied property vs. investment property. For more information on the topic, please visit LoanLove.com for the full real estate tax guide. 

Media Contact: Kevin Blue LoanLove.com, 949-292-8401, contact@loanlove.com

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SOURCE LoanLove.com