Specific Tax Implications Associated with Purchasing a Vacation Home

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<h1>Specific Tax Implications Associated with Purchasing a Vacation Home</h1><strong> Author: <a href='http://www.articleseen.com/profile_Jason Frey.aspx'>Jason Frey</a></strong><br /><p>The Tax Benefits of Purchasing a Vacation Home in Montana There is no doubt that the United States is filled with incredible opportunities for purchasing second or vacation homes. Localities such as South Lake Tahoe, Myrtle Beach, Daytona Beach and Asheville are among the most popular and desirable places to retire or visit. However, new information is being brought into the light that could point to substantially better buying, selling and living conditions in Montana. Experience the Beauty of Montana Year Round Montana’s ability to showcase year round splendor of four seasons and its proximity to outdoor sports and activities makes it one of the most up and coming vacation/retirement destinations in the US. Even within a few short miles of the major cities such as Helena, Billings or Bozeman residents find the blend of exclusion and proximity they need with Montana mountain ranch land. This blend is exactly what makes Montana such a desirable location to purchase a vacation home. Even homes in Montana’s “big cities” are only a short drive to skiing, fishing or the seclusion of a high mountain lake. Tax Benefits and Tax Laws Associated with Vacation Homes If you are in the market for a second home, you should be aware of your options as a tax payer. Your second home will be subject to one of a small handful of tax laws, depending on how often you use it or rent it out. The IRS allows second/vacation home owners to make certain deductions in their taxes from their annual tax return including interest, taxes, casualty losses, maintenance, utilities, insurance and depreciation. The U.S Tax Code allows individuals to deduct up to $1 million in mortgage interest on two homes. The rules are complicated but generally, to qualify as a second home by the IRS you must use the rental home at least 14 days of the tax year or ten percent of the time that it was rented to other people at a fair price. Other criteria include stipulations regarding how often you or a renter is present on the property. To qualify as a vacation home, the home must be occupied by: 1. You or any other person who has an interest in it. 2. A member of your family or of a family of any other person who has an interest in it, unless the family member uses it as his or her main home and pays a fair rental price; 3. Anyone under an agreement that lets you use some other dwelling unit; or 4. Anyone at less than fair rental price. (Source: Internal Revenue Service, 2010) Other Incentives to Purchasing a Vacation Home Although the tax breaks can be an excellent incentive to purchasing a vacation home, it should not be the deciding factor. Location, amenities, and accessability are the defining factors of a great vacation property. Montana has a state population of under 1 million people but has over 123 diferent airports to fly in to, making it one of the most accessible regions of the country. Along with properties that blend ‘proximity to’ and ‘seclusion from’ every major city in Montana, you can get away from your normal routine without sacrificing the modern luxuries that you’ve grown accustomed to. For those that have not considered the value of a Montana home in the mountains, consider the fact that Montana is one of the top destinations for winter sports, showcasing attractions such as the Big Sky ski resort, Whitefish Mountain Resort, Bridger Bowl, Red Lodge or Turner Mountain. Along with access to millions of skiing acres, Montana also offers opportunities for summer activities such as ranching, hunting, fishing, trapping, horseback riding and so much more. Montana offers activities for vacation home owners 365 days a year. Your vacation home should be a dream indulgement as well as an investment and while the tax incentives can be a deciding factor in whether you purchas a second home or not, just remember that a great vacation home is more than just tax incentives; it is a place that you and your family will cherish for generations to come.</p><strong>About the Author:</strong><br />Jason Frey is an outdoor enthusiast with roots in working for a cattle ranch in North Dakota, he know combines his interests with his profession as real estate agent for the <a rel="nofollow" href=http://www.purewest.com>Big Sky land near Bozeman, MT</a>. Frey takes pride in the <a rel="nofollow" href=http://www.purewest.com>Montana luxury homes</a> he sells, understanding the value and practicality of ranch land and large parcels. More information on Montana mountain land, please visit http://www.PureWest.com<p> Article Source: <a href='http://www.articleseen.com/Article_Specific-Tax-Implications-Associated-with-Purchasing-a-Vacation-Home_28279.aspx'> http://www.articleseen.com/Article_Specific Tax Implications Associated with Purchasing a Vacation Home_28279.aspx</a></p>

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Keywords : Montana luxury homes, Montana mountain land, Big Sky land near Bozeman, MT,

Category : Finance : Real Estate