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http://turbotax.intuit.com While renovating a home can be expensive, there are federal tax deductions for home renovation ...
that may help reduce your tax bill. Qualify for a home renovation tax credit this year and increase your tax savings.
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Hello, I'm Sara from TurboTax with some information on how you can reduce your tax bill by renovating your home. Anyone who has taken on a home improvement project can tell you that making renovations to your home can be expensive. Although you can't deduct the actual renovation cost from your taxes, you can deduct the interest you pay if you borrow funds to make the renovations. Those funds must be from a home equity loan or a additional mortgage funds you borrow when you purchase the home. You should avoid using a credit card to finance the renovations since this type of interest is not deductible. You can also increase your tax savings by keeping the environment in mind when making the renovations. In 2010 you can claim a tax credit that can save you up to $1,500 in tax when you install energy efficient appliances, new windows and doors, and even for increasing the amount of insulation in your home. This is much better than a tax deduction because it will reduce the amount of tax you owe on a dollar for dollar basis. You can even reap some of the rewards when you eventually sell your home. Essentially you can add the cost of certain renovations to the purchase price of your home. This is the effect of reducing the taxable gain on its sale so you pay less in taxes. For more information about deductions on your income taxes, visit TurboTax.com.