When you own a home, you have numerous expenses, including mortgage payments, homeowners insurance, and maintenance costs. If you itemize deductions on your tax return, you may be able to deduct expenses like your mortgage insurance premiums and property taxes from your income tax. But is homeowners insurance tax deductible?
Generally, homeowners insurance premiums for personal homes are not tax deductible. If you don’t generate any income from your home, you can’t write off your homeowners insurance, since the IRS considers it to be a nondeductible expense.
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There are a few situations where your home insurance might be tax deductible. If you generate income from your home, such as by renting it out as an Airbnb, or if you have an income-generating apartment within your home, you might be able to write off part of your insurance premiums. You would only be able to write off the portion of your insurance premiums that cover the part of your home that generates income.
The same is true if you run a business from your home. If you have a home office, you can write off a percentage of your homeowners insurance premiums. To determine that percentage, you would measure the square footage of your home office and your whole home. Then, you would calculate what percentage of your total home consists of your office space. You would be able to write off that same percentage of your homeowners insurance premiums.
If you have homeowners insurance on a property that is strictly an investment property and you don’t use it as your residence, the homeowners insurance for that property is tax deductible, too.
Homeowners insurance may not pay off as a tax deduction in many cases, but its real value lies in the protection and peace of mind it gives you. Homeowners insurance can help to protect your home and your personal property. It can help repair or replace your home after damage and also protect you if another person is ever hurt while on your property. Additionally, if you have a mortgage, chances are your lender will require you to carry homeowners insurance on your home.
There are plenty of ways to save on homeowners insurance, too. Compare quotes and different policies to find the best option. Consider choosing a higher deductible, which can help to keep your premiums down. Ask your insurance provider if you’re eligible for any discounts, too.
Whether you’re just starting to shop for home insurance or want to see if you can find a more affordable policy, you can get a free, personalized homeowners insurance quote online today to start shopping around.
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Paige Cerulli Paige Cerulli is a freelance content writer and journalist who specializes in personal finance topics. She graduated from Westfield State University and brings more than a decade of professional writing experience to the ConsumerCoverage team. Paige’s work has appeared in outlets including USA Today, Business Insider, and more.
