What are the deductions allowable if a Taxpayer Purchases a New Home in 2008?
If you purchase a new Principal Residence, you are entitled to deduct the Mortgage Interest along with the Property taxes on Schedule A of the Individual Tax Return Form 1040.
As such, a taxpayer who files Married Filing Joint Tax Return is entitled to a standard deduction of $10,900 in Tax Year 2008. ($5,450 for Single Filers).
Now, by electing to itemize on your 2008 tax return, you will be able to deduct your home mortgage interest and property taxes, in addition you are also entitled to a deduction of Charitable Contributions, State and Local Taxes paid either through estimated taxes or amount that have been withheld on your W-2.
Thus, the very fact that you would be purchasing a new home, will enable you to elect to itemize on your 2008 Individual tax return, assuming the total amount reported on Schedule A exceeds $10,900 that is readily available as a Standard Deduction allowance.
The only additional charge would be that charged by your CPA or Tax professional for preparing that additional schedule A, that may range from $125-$250 depending on your specific location.