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There’s a lot to consider when you purchase a condo, from mortgage payments to condo fees beyond that. But do those fees include property tax, and how does that impact your income taxes?
Follow along as Karen McDonald, Community Manager with Brookfield Residential, answers the question of whether property taxes are included in condo fees and whether you can claim the fees on your taxes.
No they're not, Karen says, explaining that they’re separate. “That’s because property taxes are charged from the municipality in which you live and your condo fees are paid to the management company.”
Are taxes included in the condo itself? “Generally not, no. Real estate taxes, again, they’re separate from your condo fees,” says Karen. “Real estate taxes are paid directly to the municipality. They're completely separate entities. With condo fees, you're paying for the management company to take care of all of the maintenance of the development. ”
No, you cannot claim or deduct those fees, at least not on a regular basis, according to Karen. “You only can if you're using your home as an office space. You may be able to claim a portion of that towards your taxes.
If you have a multifamily home as a rental investment property,” she adds. “You may be able to claim a portion of those condo fees on your taxes. But in general, no.”
Condo fees for a rental property may be tax deductible. “You may be able to collect a portion of that money back,” Karen says.
For more helpful homebuying tips, head to our blog for topics like should you buy a condo or a house and the steps involved in buying a new construction home. To find out more about what Brookfield Residential communities have to offer, contact us or take a look at where we build.