Real Estate Blog

This is a great time for buyers to invest in second homes. Chicago has an abundance of great condos at good prices with great rental and appreciation potential. Besides appreciation and rental income, second homeowners can add to their income with great tax deductions.

Mortgage, taxes and insurance

• Property taxes
• Property insurance
• Flood insurance
• Liability insurance
• Mortgage interest
• Private mortgage insurance (PMI)
• Refinance and closing fees

Homeowner’s association

• Monthly assessments
• Special assessments

Operating expenses

• Utility bills
• Expenses incurred to repair damages
• Housekeeping expenses
• Maintenance expenses and preventive maintenance
• Property management fees

Advertising expenses

Capital Improvements and amortized items

• Improvements on the home
• Depreciation Deductions

Administrative expenses

• Tax preparation
• Legal fees
• Fees to open and maintain a bank account for rental money

There are many deductions available when owning real estate. These deduction should be discussed with a tax professional before filing a tax return. More details can be found in the IRS Publication 527, Residential Rental Property