Real Estate Taxes

Most state and local governments charge an annual tax based on property value. This is called real estate or property tax.

Taxes are an added cost, but as a homeowner you can now look at deducting many home-related expenses, unlike when renting. If you took out a mortgage loan, you can usually deduct the entire part of your payment that is for mortgage interest, if you itemize your deductions on Schedule A (Form 1040). Consult an accountant to find out what deductions are allowed by current tax laws.