Vacation Homes in Destin FL are highly Desirable
Vacation homes in Destin FL are becoming quite the desirable location. The number of things to do and the climate are part of the reason that people are finding this is a great place to buy a vacation home. However, there are other beneficial aspects as well. There are several tax breaks that apply to those who decide to purchase a second home. The property taxes can be deducted just like the ones deducted on the primary residence. If vacation homes in Destin FL are rented for two weeks or less during the year, no taxes have to be paid on this rent. In addition, because you only rented the home for a short time, it is considered a primary residence, which allows the property taxes and mortgage interest to be deducted.
Be careful of renting your vacation home in Destin FL for more than two weeks. If you do, all the rental income must be reported to the IRS. This means you will pay a tax on this income. There is another way that people can take a tax deduction on the property. If you do not use the home for personal use over 14 days, the home is considered a business. This qualifies the home for $25,000 in losses that can be deducted.
Maintaining vacation homes in Destin FL are not considered personal use. The homeowner can reduce the amount of leisure time spent at the home by maintaining it and save quite a bit in taxes. For those who are in the 28% tax bracket, this could be a savings of $7,000 per year.
The market for vacation homes in Destin FL and other areas as well as investment properties dropped in 2009. They remained fairly steady for 2010. The sale of vacation homes were 10% of transactions last year and investment properties were 17% of all transactions.
Affecting the overall sale of homes are the changes that have been made in lending and down payment requirements. Many people are purchasing vacation homes in Destin FL for cash rather than obtaining a mortgage. The same holds true for investment property.