What are some interesting tax benefits for owning a house?

[Alexander Reyes]

Anyone have any interesting tax benefits that I could use in the Houston Texas real estate market or any general tax advice? Any CPA’s in the Houston area or tax advisors?

[Ryan Lane]

Well, because you live in TX, the property tax deduction on your personal return is more valuable than it is in most states. That's because of the $10,000 SALT limit on schedule A. Where in other states this amount includes the state income taxes you pay (which by itself amounts to more than $10,000 for some people), TX doesn't have state income taxes, so the property taxes will count more towards your itemized deduction total.

The deduction is more valuable on a rental property because you can deduct the full amount on schedule E, without much limitation (subject to certain rental passive income/loss rules).

Some states/counties/localities, will provide tax rebates or credits for installing certain high-efficiency HVAC systems. So if you are ever looking to replace those pieces, I would look into that piece. Though it's not worth spending several thousand to upgrade a system that doesn't need it.

As a personal primary home, you can exclude $250,000 of gain ($500,000 if married) upon sale. But this is subject to certain rules.

There's also the 1031 exchange route to defer your taxable gain into a similar property. Again, this also has many rules. And it's important to note that it's not circumventing the tax -- you'll eventually pay the tax unless you hold the property until death.

These are fairly common strategies, but not everyone takes advantage of them properly.