Is Homeowners Insurance Tax Deductible?

Your homeowner's insurance is not tax deductible if you use your house only as your dwelling. According to the Internal Revenue Service, only private mortgage insurance, can be written off, and not homeowner's insurance.

There are, however, certain exceptions. Here are several scenarios to consider that can qualify your homeowner's insurance as a tax deduction.

Homeowners' insurance exceptions for tax deductions

Do you operate a business from your residence?

You might be able to deduct a portion of the cost of your home insurance from your gross income if you work from home. The deduction is calculated according to the square footage of the workspace in your home; it cannot be used for a den or other place that occasionally doubles as an office space. Consult an accountant or other financial expert to ensure your deduction complies with legal requirements.

Do you earn money from rentals?

You might be allowed to claim property insurance for this portion of your home as business expenditure if you have a tenant.

Have you filed a claim for loss or theft?

If you file a claim for theft, damage, or another sort of loss, you might be entitled to deduct the difference between your insurance payment and the cost of the loss. You might be able to deduct it from your taxes the following year if the resulting costs exceed your policy limit and you have to pay out of pocket for loss or damage. You can find out if your theft or loss claim is eligible for this deduction by consulting your accountant or other financial experts.

Speak with your accountant or a financial expert if these circumstances apply to you. They could direct you on the appropriate path.