5 real estate deductions Phoenix homeowners may be missing

March 29, 2026 - 06:48

As tax season approaches, financial advisors are urging Phoenix homeowners to review their records for often-overlooked housing-related deductions that can provide significant savings. While itemizing is required to claim most of these benefits, those who qualify may find the effort well worth it.

A primary opportunity lies in mortgage interest deduction. Homeowners can deduct interest paid on mortgages for primary and secondary residences, up to a set limit. This frequently constitutes the largest portion of a homeowner's tax savings. Additionally, property taxes paid to Maricopa County and local municipalities are also deductible, with a cap of $10,000 combined with state income taxes.

Homeowners who have taken out a home equity loan or line of credit may deduct the interest if the funds were used for substantial home improvements, not personal expenses. Further, points paid to secure a mortgage, whether by the buyer or seller, are generally fully deductible in the year they were paid.

For those who work from home, a dedicated home office space may qualify for a deduction based on its percentage of the home's total square footage. Finally, homeowners who made energy-efficient upgrades, such as installing solar panels, may be eligible for specific residential energy credits. Consulting with a tax professional is essential to navigate eligibility and maximize these potential benefits.