What Real Estate Taxes Are Deductible?
You can deduct real estate taxes on a personal‑use property if the tax:
- Is based on the assessed value of the property
- Is uniformly applied across the community
- Funds general government services
- Applies to U.S. property only (foreign personal property taxes are not deductible)
These taxes are claimed as itemized deductions on Schedule A.
How to Enter Real Estate Taxes in Tax Software
Enter real estate taxes for personal property in either location:
- Federal → Deductions (Select my forms) → Itemized Deductions → Mortgage Interest and Expenses
- Federal → Deductions (Select my forms) → Itemized Deductions → Taxes You Paid → Additional Real Estate Taxes for Non‑Business Property
These two options also allow separate entries for multiple homes.
⚠ For tax years 2020–2022, new entries may overwrite prior amounts.
SALT Deduction Limit (Starting 2025)
The SALT deduction covers:
- State income or sales tax
- U.S. real estate tax
- Personal property tax
Maximum deduction:
- $40,000 for most filers
- $20,000 for Married Filing Separately
Foreign Real Estate Taxes
Personal‑Use Foreign Property
Foreign real estate taxes on a personal residence or vacation home are not deductible on Schedule A. Foreign property taxes are not included in SALT.
Rental or Business Use
Foreign real estate taxes are deductible when the property is:
- A rental
- Used in a trade or business
- Held to produce income
These are deducted on Schedule E.
Real Estate Taxes for Rental Properties (U.S. or Foreign)
Real estate taxes for rental property are:
- Fully deductible as a rental expense
- Reported on Schedule E
- Not subject to the SALT limit
- Allowed for both U.S. and foreign property
Mixed‑Use Properties
If a property is partly personal and partly rental:
- Deduct the rental portion of taxes on Schedule E
- Deduct the personal portion on Schedule A (U.S. properties only)
Refunds and Rebates
Reduce your deduction only if the refund relates to taxes paid in the same year.
Non‑Deductible Charges
Do not include:
- HOA dues
- Trash or utility fees
- Homeowner’s insurance
- Property maintenance or service charges
These are not considered taxes.