Buying your first home can quickly become overwhelming. By the time you find a great house in the right location, at a price that fits your budget and with enough square footage to meet all of your needs, you are ready to just sign the papers and be done. We get it. Purchasing a home is not for the faint of heart, but the effort is well worth it end the end.

While homeownership comes with a significant financial responsibility, there are also several perks available to first-time homebuyers. Even though more paperwork and numbers are the last thing you want to look at after finally sealing the deal, there are several tax benefits you should be educated about.

Home Mortgage Interest Deduction
Once you own a home, all of the interest that is paid toward your home mortgage can be deducted when you file your yearly taxes. However, there are a few exceptions to this rule. If your mortgage is greater than $1 million or you have an unsecured loan, you will not be able to take advantage of this perk. This is one of the most widely known tax benefits for homeowners, so make sure you capitalize on this opportunity.

Real Estate Tax Deduction
The monthly mortgage payments for most homeowners include an additional amount to cover real estate taxes as well, and these funds are put into an escrow account. The money paid out of your escrow account to cover the real estate taxes can be used as a deduction.

PMI Deduction
Private mortgage insurance (PMI) is required on some loans to protect the bank in the event that you are unable to make your payments. PMI is particularly common among first-time homebuyers who cannot afford to make a significant down payment. While PMI is not typically deductible, qualifying homeowners who itemize their taxes can deduct this amount in 2015.

Relief from Capital Gains Taxes
If you just bought your first home, you are probably not thinking about selling it just yet. However, resale should always remain at the back of your mind. If you have lived in the home for two of the last five years when you do go to sell, you can significantly reduce the amount of capital gains tax that you have to pay.

All of this information may seem a bit daunting when you first buy a house, but it all comes down to staying informed about the financial and tax opportunities available to you.

At Henderson Properties, we promise to communicate timely and accurate information to our clients.