Team Leader and founder of the Elite Asset Management Team – Pete Veres, RE/MAX Elite would like to share the following information with you as tax time is approaching very soon. If you’re like most people, you assume the IRS wants as much information about your financial life as possible. And that’s typically true — except when you sell that Atlanta, GA real estate and make a profit of less than $250,000 (or less than $500,000 when you file a joint return with your spouse). If you meet those qualifications, and if you have lived in that home for two of the five years before you sell, the IRS doesn’t want to hear about your home sale, because the profit you make is excluded from being taxed under U.S. Code Section 121.

As if that weren’t enough, there’s more good news you should know: The IRS grants some tax deductions for home sellers. Getting the deductions requires that you itemize your taxes, admittedly a tedious job, but one that is probably worth your while. Here are five tax deductions you should take this year.

1. Selling costs

If you don’t qualify for the 121 exclusion, you will owe taxes on any profit, so make sure you deduct all your selling costs from your gain. Here are some of the items you may be able to deduct.

Your real estate agent’s commission

Legal fees

Title insurance

Inspection fees

Advertising costs

Escrow fees

Legal fees

And there’s another consideration. Vanessa Borges, an enrolled agent and tax preparation supervisor with the Tax Defense Network, notes, “You might qualify for a partial exclusion if you sell your home due to circumstances involving divorce, change in employment, change in health, or other unforeseen circumstances.”

2. Moving deduction

If you have to sell your house because you’re relocating for work, you might be able to deduct some of your moving expenses, says Chantay Bridges, a licensed senior real estate agent in Los Angeles, CA. Deductions could include transportation costs, travel to the new place, storage costs, and lodging costs.

 3. Property tax deduction

“You can deduct your property taxes for the portion of the year that you owned the home,” says Dr. Kimberly R. Goodwin, associate professor of finance and the Parham Bridges Chair of Real Estate at the University of Southern Mississippi. Deduct the taxes “up to, but not including the date of the sale,” according to the IRS. The buyer pays beginning from the sale date.

4. Home improvements

In some cases you may need to improve your home — not for your own benefit and enjoyment, but for the home’s future owners. If you make home improvements that help sell your home (like replacing a leaking roof or defunct HVAC system), and if they are made within 90 days of the closing, they are considered selling costs, which are deductible, according to Goodwin. Please confirm these with your local tax adviser.

5. Points

If you paid mortgage points to lower your interest rate when you refinanced your home, you might qualify for an additional deduction, says Bridges. Because you can deduct a proportional share of the points until the loan is paid, when you pay off the loan through a sale, you can “deduct the remaining value of those points,” says Goodwin.

What can’t you deduct?

Tax deductions are fickle. They “can vary from state to state and from year to year,” says Bridges, who suggests that home sellers check with a local tax expert to confirm the deductions are still available at the time of the sale.

Taxes can be confusing (Who knew?)

There is also some confusion regarding deductions. Sean P. Storck, a certified financial planner and enrolled agent with Rawdin-Baron Financial in California, explains that many sellers think they can deduct, but can’t. Storck says the biggest misconception concerns repairs, and that “generally speaking, anything done in the course of maintaining property for normal use is nondeductible.”

The same goes for what Storck calls “phantom labor,” in which “you do the work of constructing your home on your own.” Although you may have worked your tail off, you still cannot deduct your sweat equity come selling time.

This is some good information and remember to always check with you local tax adviser for the current rules and regulation.