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3 Lesser-Known Tax Breaks Homeowners Miss Did you know most homeowners can write off all mortgage interest up to $1.1 million for primary and secondary residences, as well as property taxes? Credits for property taxes and other tax breaks are also offered to in 21 states and the District of Columbia. But mortgage interest and property taxes are not the only tax savings homeowners can enjoy. Look to see if you qualify for other deductions, including:

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Q: Are There Tax Credits for First Time Homebuyers? A: Yes, thanks to the many city and county governments that offer Mortgage Credit Certificate (MCC) programs, which allow first-time homebuyers to take advantage of a special federal income tax write-off. The credit reduces the amount of federal taxes paid by the buyer each year, if he keeps the same loan and lives in the same house. An MCC also makes it easier for eligible buyers to qualify for a mortgage loan. The lender can reduce the housing expense ratio – the percentage of gross monthly income applied toward housing expenses – by the amount of the tax savings. Normally, lenders reject loans if the housing expense ratio is too high.