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Tax deduction on home

Forum|Forum|7 years ago
June 1, 2019
2 replies
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Is there a tax deduction for building a house like there is for buying a house or can you use the same?

TurboTax Free Edition Online

Best answer by DexterS

The deductions related to home ownership are the same whether you build or buy.

If you paid sales tax on the building materials you could accumulate those amounts to see if it gives you a larger deduction than your state income tax.

D

DexterSAnswer

Employee

The deductions related to home ownership are the same whether you build or buy.

If you paid sales tax on the building materials you could accumulate those amounts to see if it gives you a larger deduction than your state income tax.

V

volshater_04Author

So where would that tax break be listed at?

D

DexterS

Employee

If you are in TurboTax Free here's how you enter Sales Tax Paid:

Under "Federal Taxes" Select "Deductions & Credits"
Click through "tax breaks" until you get to "Let's check for tax breaks" Select "Jump to full list"
Scroll down to "Estimates and Other Taxes Paid"
Select "Show More"
Select "Start" where you see Sales Tax
Next you'll see "Sales Tax and Income Tax" Select "Continue with Sales Tax"
Next you'll see "How do you want to enter your sales tax info? Select "Enter All My Receipts"
Next you'll see "Enter Sales Tax You Paid", fill in the amount.

Sales tax is an Itemized Deduction (Schedule A). Unless you have enough other itemized deductions i.e. Mortgage Interest, Property Taxes, Charitable Deductions along with Sales Tax to get you over the "Standard Deduction" this won't be to your benefit.

Also, you'll have to upgrade in order to file. TurboTax Free doesn't support Schedule A, but you can see if it's to your advantage.