For many Americans, a home is their biggest asset. And while owning a home comes with many responsibilities, it also has its share of perks. No one wants to pay more than they have to, so it’s important for Maryland homeowners to be aware of the tax credits they can take advantage of. Here’s a quick rundown of the tax benefits that Maryland homeowners can expect.
Homestead Tax Credit
If you are the principal resident of a property, the Maryland Homestead Tax Credit limits how much your property taxes can go up each year. Homeowners pay no property tax on increased value that is above a cap. The Maryland Department of Assessments and Taxation lists the Homestead Percent Caps for Maryland jurisdictions. If you meet the requirements and file an application, you can receive a discount on your property taxes. However, you must live in the property as the principal resident and have done so for at least a year before submitting an application.
A document filed with the deed when you purchase a property typically states that you are the property’s principal resident. Each County has its own form, and once the County’s Assessor’s Office updates their records to reflect you as the owner of your property, an application for Homestead Tax Credit Eligibility will be sent to your property.
Homeowner’s Property Tax Credit
Lower income homeowners receive relief in the form of a tax credit based upon his or her income. To qualify a homeowner’s net worth must not exceed $200,000 and the gross household income cannot exceed $60,000 per year. Applicants should report and provide documentation for all income sources, before deductions, including non-taxable retirement benefits like Social Security and pensions. Consult a tax professional for more information.
Federal Tax Benefits
Homeowners may deduct the interest paid toward their mortgage loan from their total income earned when it comes time to pay taxes each year. Both primary and secondary residents (such as a vacation home) can claim this deduction if they spend at least a few weeks at the home each year. For more information on federal tax benefits for homeowners, consult a tax professional.
Get in Touch with Colony Title Today
At Colony Title, we’ll make sure you don’t run into any complications with your property’s title and help you find cost effective solutions. Specializing in real estate title insurance in Maryland and DC, our agents will perform a title search, check all past documentation, and seek to uncover any fraud or forgery associated with the title. Protect yourself from legal intervention caused by property disputes and call Colony Title today!
If you have questions, the Maryland real estate insurance experts at Colony Title Associates can be reached by calling 410-884-1160 or visit ColonyTitle.com today!