Title: Identify the benefits of home ownership.
Course: Real Estate (12154) > Section: Examining Home Ownership

Explanation should include

- tax benefits:
  - deductibility of home-loan interest and real estate taxes from taxable income
  - deductibility of certain loan origination fees, loan discount points, and loan prepayment penalties
  - introduction of the 1031 exchange as it applies to investment property

- equity
- lifestyle (“homeowner freedom”).

DPOR correlations: 18VAC135-20-400. 10 (Home ownership); 18VAC135-20-400. 13 (Taxes in real estate)

Process/Skill Questions:

- How has recent legislation affected the ability of homeowners to claim certain tax deductions?
- How does payment of loan interest affect personal income taxes?
- Under what circumstances can a homeowner defer payment of tax on profit?
- Under what circumstances might a residence be sold at a profit with no tax liability?
- What investment considerations should be made when considering home ownership?
- Why would a homeowner want to hold onto property for more than two years, considering capital gains tax?
- What can a homeowner do with the equity in their property?