Let's say, hypothetically, that you are a single male, earn $50,000 gross anually, live in Illinois (state tax implications), and are looking at purchasing a home with a $140,000 mortgage at a 6.25% interest rate. You have about $450 in pre-tax expenses taken out of your paycheck every month, not including government taxes.Your first year you will pay $10,344.05 in interest expense, and $1,640.51 in principal. What are the tax benefits / implications of purchasing this property?Thanks.

Under current tax law (for owner occupied properties) all interest paid ($10,344.05 in your case), your property taxes, as well as any closing costs that you pay (not counting pre-paids) are all tax deductible. Owning a home is basically a huge deduction. If you are still considering the condo, the association dues are not duductible. --------------------------------------------------------Added: Condo associations (the bylaws are different with each association and could be drawn up however the association deems... you have a voting influence owning a condo in any rules / changes) do not restrict your ability to resell the unit (I've NEVER had a problem and have sold nearly a hundred condominium units in various developments). The association is made up of all the owners, it is definately not in their best interest to make it more difficult to sell. Perhaps she's refering to cooperatives where you don't own anything by yourself. Without exception with conodminiums you own the interior of your unit and can remodel or decorate however you see fit. There usually are rules and limitations as to what can be done (if anything) to the exterior, but you own the interior and can do whatever you'd like. Good Luck with your decision.