According to smartasset.com, the median annual property tax payment in Massachusetts is $4,899, a smidge higher than the national average of $4,950. Let's see what kinds of deductions you may be able to take this year.

Not every homeowner will qualify for everything listed here. I’ve grouped them accordingly, with the most popular and easy-to-take deductions up top and the less common or trickier ones below. If you want to learn more, go to the Mass.gov guide for taxpayers here, or look up federal tax breaks at the IRS website.

Mortgage Interest Deduction

This is one of the most significant tax breaks for homeowners. You can deduct the interest on loans used to buy, build, and improve your home. The interest deduction applies to loans of up to $750,000 ($375,000 if married filing separately).

Property Taxes

You can deduct up to $10,000 ($5,000 if married filing separately) of property taxes in combination with state and local income or sales taxes.

Mortgage Points

If you paid points to get a better interest rate on your mortgage, you may be able to deduct them. Learn more from the IRS here.

Private Mortgage Insurance

If you have to pay private mortgage insurance (PMI), you can deduct the premiums.

Residential Tax Exemption

Many communities in Massachusetts offer a tax break if you live in the home you own. Read our blog to see your tax rate, and whether your city or town qualifies for the residential tax exemption.

Home Office Expenses

Raise your hand if you now work from home… Wow, a lot of hands in the air! Remember, if you work from home, you may be able to deduct some of your home office expenses. You need receipts to back up your itemized deductions. Read this article by Turbo Tax for more information.

Senior credits

1. Homeowners (and renters) over 65 can can claim a tax break to offset their real estate taxes (or rent) they paid out during the year.
2. Depending on where you live, some homeowners over 60 can participate in a tax workoff program that can get them up to $1,500 off their property taxes. My dad does this: he spends a few hours each week at a lake in his town and inspects boats for plants before they’re launched. This helps prevent the spread of invasive species into the lake, my dad gets to chat with local boaters, and he gets a big tax break. It’s one of those very effective programs that seem to benefit everyone involved! Call your town or city hall to ask if your municipality has this program.

Residential Energy Credit

If you made energy-efficient upgrades to your home (such as heat pumps, solar panels, or an on-demand water heater), you may be eligible for a tax credit of up to 10% of the cost of the upgrades, up to a maximum of $500.

Medically Necessary Upgrades/Equipment

If you made medically necessary upgrades to your home, you may be able to deduct their cost. A common example of these upgrades is wheelchair-accessible changes such as ramps or accessible bathtubs. 

Capital Gains

If you sold a home in 2022, you may be able to exclude up to $250,000 ($500,000 if married filing jointly) of the capital gains from the sale from your taxable income.

Moving expenses

Whether you sold or bought, you may have moved in 2022. Oftentimes, you can deduct the expenses for your move (keep those receipts).

All of these possible deductions can add up to some significant savings. Do your research, ask questions of your tax advisor or preparer. The bottom line: When you’re doing your taxes, take the time to benefit from being a homeowner in Massachusetts!