Top 5 Tax Deductions Homeowners Often Miss

Owning a home comes with many benefits—and tax deductions are one of the biggest ones. While most homeowners know about mortgage interest and property tax deductions, several valuable tax deductions are often overlooked. Missing them could mean leaving money on the table.

Here are the top 5 tax deductions homeowners often miss, explained simply and clearly.

1. Home Office Deduction

If you work from home—even part-time—you may qualify for the home office tax deduction.

You can deduct a portion of expenses like:

• Utilities
• Internet
• Home insurance
• Repairs and maintenance

Key tip: The space must be used regularly and exclusively for work. Even a small room or dedicated corner can qualify.

2. Energy-Efficient Home Improvements

Many homeowners don’t realize that energy-efficient upgrades can come with tax benefits.

You may be eligible for tax credits or deductions if you install:

• Solar panels
• Energy-efficient windows or doors
• Heat pumps or insulation upgrades

These incentives not only lower your tax bill but also reduce long-term energy costs.

3. Mortgage Points

If you paid points when buying or refinancing your home, you might be able to deduct them.

Mortgage points are fees paid upfront to lower your interest rate. In many cases:

• Points paid on a home purchase may be fully deductible in the year paid
• Refinance points can often be deducted over the life of the loan

Many homeowners forget to check their closing documents for this.

4. Property Tax Prepayments

Some homeowners pay property taxes early, especially toward the end of the year.

If you prepaid property taxes:

• You may be able to deduct them in the year they were paid
• This can be helpful for maximizing deductions before year-end

Always confirm that the tax was assessed before you paid it.

5. Casualty and Theft Losses

If your home was damaged due to events like:

• Natural disasters
• Fires
• Storms
• Theft

You may qualify for a casualty loss deduction, especially if the damage wasn’t fully covered by insurance.

This deduction is often overlooked because homeowners assume insurance is the only option.