Is homeowners insurance tax deductible?

is homeowners insurance tax deductible

Understanding if home insurance is tax deductible

The Internal Revenue Service does not consider homeowners insurance or premium plans as nondeductible fees, i.e., not tax-deductible. Although you cannot itemize payments for issues like theft, fire, or comprehensive coverage on your tax payouts, there are other aspects of home insurance that can be deducted on taxes.


YouTube video

Ways to Deduct Homeowners Insurance On Taxes

Small Business

One way to make homeowners insurance tax deductible is if you use a portion of your house for a small business. Businesses like daycare, lawn care, gardening, or if you convert a portion of a room as an office, your homeowner’s insurance company might have a coverage plan for you as a small business owner. This way, you can successfully deduct a part of your home insurance from taxes incurred. Talk to your agent today about your options.

Damages From a Disaster

It is also possible to deduct home insurance from taxes because of damage made to your home and losses that were incurred because of a federally recognized disaster. In 2019, a lot of natural disasters were federally recognized, homeowners who filed for an insurance claim as a result of losses and damages incurred during this period might have successfully deducted some portions of their home insurance premiums from tax.

Though there were a lot of terms and conditions regarding a filed insurance claim, successfully adhering to the conditions made could help deduct your home insurance and premiums. In most cases, added expenses that we’re not previously insured could not be deducted from the tax.

Insurance Costs on Rental Properties

Insurance costs taken on rental properties can be deducted from a federal tax return. The landlord has the opportunity to write off premiums and like most business expenses, it can be successfully deducted from taxes. It should be noted that the larger your premium collected on your houses, the larger the tax-deductible portion of your insurance. For example, if you only rent out your attic, then only the premium or insurance coverage on that part can be tax-deductible.

Landlord Insurance Policy

Similarly, if you own a separate building, (not where you reside), as a landlord, you can deduct the entire home insurance premiums covering the home from taxes. This is referred to as a Landlord Insurance Policy or Umbrella Policy which allows property owners to deduct the insurance policies covering the rental property.

Final Thoughts

In summary, is homeowners insurance tax deductible? No. Only if you run a business out of your home, if you receive rental income, or if you incurred damages as a result of federally recognized disasters. Is it still worth the cost of insuring your home? Yes. It is a necessity to make sure your family and all you own is protected and covered regardless of any unforeseen circumstances. This is why it’s important to speak with your insurance agency frequently. Having a good relationship with your CPA and insurance agent can save you a lot of money down the road.

To learn more about your home insurance policy and to get a free quote, call us at (509) 242-3244 or visit us at

Would You Like Us To Review Your Policies?

  • MM slash DD slash YYYY

Request Your Proposal Here

Are you ready to save time, aggravation, and money? The team at KBG Insurance & Financial is here and ready to make the process as painless as possible. We look forward to meeting you!