USA What tax deductions can I expect from owning a condo?

[b0chatma]

Hi All,

I'm considering buying my first home with my wife. It's a condo. What I can't figure out is how much we can expect in tax deductions on a property like this. Can you have a look below at the specs and let me know your thoughts?

Condo

Price: $425,000
Down Payment: 20%
Loan Amount: $336,000
APR: 4.5%
Annual Interest Payments (year 1): $15,009
HOA Fees: $500/month

My wife and I make about 200k annually (w-2).

Do you know how much we would be able to deduct from our taxes as a result of purchasing this condo? How much does that likely come out to in dollars?

If we don't put 20% down and have to pay PMI insurance is that deductible as well?

This question is something I've always struggled with so any help would be greatly appreciated.

Thanks,

Brad

 

[Chrisa Anderson]

Is this your second home then? A second home you would potentially be able to deduct all of your mortgage interest (you do have a main home that would put total debt over 1.1 mil)? The real estate taxes, you should be able to look at the sale proposal or maybe Zillow.com and get an idea of the annual amount. Your income is too high, you would not be able to deduct the PMI. $200K AGI would put you in the 28% marginal bracket, do you have other income and deductions for AGI though (interest income, dividend income, capital gains, etc.). Your ability to deduct the real estate taxes and mortgage interest expense will also depend on whether you have other itemized deductions.

Hope this helps.
Chrisa

 

[Chrisa Anderson]

No on home ownership dues also, if it is your "second home". If it is going to be a rental than the answers all change.

 

[Williams Karl]

Consulting a tax lawyer can be helpful.