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I bought a house in India in 2016. In that process I had to pay few different taxes to government. I took a loan as well. Which of these can I show in Itemized deductions?

Government Taxes

  • Stamp Duty (Specifically related to real estate buying process)
  • Registration (Specifically related to real estate buying process)
  • VAT (Type of Sales Tax)
  • Service Tax (Type of Sales Tax)
  • Loan Charges/Fees: Bank took bunch of loan fees and charges when giving me loan. I have all the receipts for the above.

I will be getting Loan Interest Certificate in few days from My bank.

  • Loan Interest paid in 2016

In government taxes there are some which are type of sales taxes. I am not sure where I read, but it says that if you buy property outside USA, you can only show property taxes, no sales tax. Please let me know if you need anymore information.

Note: House is not on rent.

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Based on this IRS document, Publication 530, you can deduct the loan interest and any property taxes that do not provide a benefit. For example, if the property taxes include a fee that is used to improve the local roads, that would not be deductible.

If the house is not your primary residence, you cannot deduct the "points" (money paid to reduce the loan interest rate or used as the "origination fee") like you can for loan on a primary residence.

  • What classifies as primary home? I live in USA but if I go back(and Whenever I go back) to India it will be and is my primary home. – rock dsouza Apr 4 '17 at 15:28
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    Primary home means where you're considered resident. Right now, that's the US. – mkennedy Apr 4 '17 at 16:52

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