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Property tax deductions: How much can you write off?
Homeownership comes with many costs. There’s your monthly mortgage payment, maintenance, homeowners’ association dues, utilities, and, of course, property taxes.
While these are all unavoidable, some of them come with a small silver lining: They’re tax deductible. This simply means you can deduct their cost from your total taxable income come filing season, reducing your tax bill. And property taxes are one of the major tax-deductible homeownership costs.
Learn more: Tax credit vs. tax deduction — what’s the difference?
In this article:
What are property taxes?
Property taxes are a type of levy paid by homeowners. They’re based on your property’s value and go toward local services such as schools, police forces, firefighters, hospitals, infrastructure, road upkeep, and more.
Each taxing jurisdiction — a school district, county, city, hospital district, or police department — has a separate tax rate. This rate is then multiplied by your property’s assessed value and added up to get your total property tax bill.
You’ll pay property taxes annually based on an updated assessment of your home’s value. Generally speaking, the more your property grows in value, the more you’ll pay (though you can protest that value if you think it’s incorrect).
Read more: 7 ways to increase your home equity
Average property taxes
Property taxes vary by county, so they can change quite a bit based on what local services are provided and the value of your home. According to the Tax Foundation, homeowners see the lowest property tax bills in parts of Alabama, Alaska, and Louisiana. Specific counties in California, New Jersey, New York, and Virginia have the highest property taxes. The average annual property tax bill in 2022 — the latest nationwide data — was $1,815.
Is there a property tax deduction?
Property taxes are tax deductible. The Internal Revenue Service considers them a “state and local tax” (SALT), and they are deductible under the IRS’s SALT deduction. You can deduct property taxes paid throughout the year. If you recently bought your home, you’re eligible to deduct the real estate taxes you started paying on closing day.
SALT deductions are limited to $10,000 annually per household or $5,000 if you’re married filing your tax returns separately. This cap is for all state and local tax deductions (not just property taxes) and can include any sales and income taxes paid to your state and local governments. (Federal income taxes, HOA fees, Social Security taxes, and transfer taxes are not considered SALT deductions, per the IRS.)
Learn more: Are closing costs tax deductible?
Itemizing vs. taking the standard deduction
Many people use the standard deduction on their tax returns — a lump-sum amount that all taxpayers are allowed to write off every year. Your eligibility for deducting property taxes relies on itemizing your tax returns instead of using the standard deduction.
The value of the standard deduction changes regularly. Here are the breakdowns for the tax years 2024 and 2025:
Remember, you will pay taxes for the 2024 tax year in 2025 and taxes for the 2025 tax year in 2026. Yes, it can get confusing.
Taking the standard deduction is likely your better option if your total potential itemized deductions are less than the standard deduction you qualify for. Talk to a tax professional to be sure, though.
Dig deeper: Standard vs. itemized deductions
Claiming the property tax deduction
The property tax deduction requires you to itemize your returns, which means filling out a Schedule A form when you file your taxes. This form lets you detail all the individual deductions you plan to take, along with their total cost.
Read more: How the mortgage interest deduction works
Property tax deduction FAQs
Are property taxes tax deductible?
Yes, property taxes are deductible. You can deduct up to $10,000 in state and local taxes (SALT) every year, as long as you itemize your tax returns.
How much of your property taxes are tax deductible?
You can deduct up to $10,000 in property taxes on your annual tax returns. If you’re married and file your returns separately, the limit drops to $5,000.
Can you deduct property taxes if you don’t itemize?
No, you can only deduct property taxes (or any other expense) if you itemize your tax returns. If you take the standard deduction, you are not eligible for the property tax deduction.
What home expenses are tax deductible?
As a homeowner, you can deduct mortgage interest, property taxes, mortgage discount points, and home office expenses. You may also be due tax credits if you make specific energy-efficient improvements to your home.
This article was edited by Laura Grace Tarpley.
