Monthly house payments bring the biggest tax benefit to home owners. The interest included in the monthly mortgage payments is tax deductible as long as the loan is for less than a million dollars. IRS guidelines also allow deductions for interest on refinancing and home equity loans. However, they do put limits on how much is actually allowed to be deducted. Borrowing against the equity of your Gainesville home is an option renters do not have. Renters also do not have the ability to file federal tax deductions on their monthly rental payments. 

Homeowners are also allowed to deduct the points paid in order to purchase their home. If the deductions are itemized, points can be deducted the same year the home is purchased. Every point is equal to 1% of the entire loan amount. When the seller pays certain fees during the purchase, points are also deducted. 

Depending on the state, homeowners who meet specific criteria may qualify for real estate tax exemption. A portion of capital gains may also be deducted. When selling the property, the IRS allows a certain portion of the profit made to be excluded. Single taxpayers are allowed to exclude up to $250,000 in capital gains, and $500,000 for married couples. 

In 2007, the government added more to the miscellaneous tax credits receivable by homeowners. For example, the Energy Credit allows homeowners to receive $200 for home improvements that make the property more energy efficient. 

There are many benefits to owning a Gainesville home. Renters and hesitant prospective homeowners should take advantage of the tax breaks that are now available.