IRS Reminds Homeowners of Tax Benefits

Published May 22, 2026

On May 21, 2026, the Internal Revenue Service (IRS) published Tax Tip 2026-42 and reminded taxpayers to review the potential tax benefits available for homeownership. While owning a home can be expensive, certain deductions and credits may help offset some of the costs associated with purchasing and maintaining a residence.

Taxpayers who itemize deductions may generally deduct state and local real estate taxes subject to applicable limits, and qualified home mortgage interest. However, only certain expenses qualify for a federal income tax deduction.

The Service emphasized that many common homeownership expenses are not deductible. These non-deductible expenses generally include homeowners’ insurance, utilities, most settlement and closing costs, homeowners’ association fees, repairs and amounts applied toward the principal balance of a mortgage loan.

The IRS also highlighted the Mortgage Interest Credit, which is designed to assist lower-income taxpayers with homeownership costs. Taxpayers who received a qualified Mortgage Credit Certificate from a state or local government agency may be eligible to claim a credit for a portion of the mortgage interest paid each year on their primary residence.

In addition, the IRS noted that ministers and eligible military members who receive a nontaxable housing allowance may still deduct qualified real estate taxes and mortgage interest. The deductions are not reduced by the amount of the housing allowance they received.

The IRS encouraged homeowners to review Publication 530, Tax Information for Homeowners, and Publication 936, Home Mortgage Interest Deduction, to better understand the available tax rules and substantiation requirements applicable to homeownership deductions and credits.