Tax Tips for Buying & Selling Real Estate in Livingston County

Understanding the tax implications of real estate transactions can save you thousands—here’s what you need to know in Livingston County, Michigan.

As a local real estate agent serving Livingston County and the surrounding areas—including Washtenaw, Oakland, and Ingham counties—I often get questions from buyers and sellers about how real estate transactions impact their taxes. Whether you're buying your first home or preparing to sell an investment property, understanding the tax implications can help you make smarter financial decisions and avoid surprises come April 15th.

Here’s a quick breakdown of what buyers and sellers in Michigan should keep in mind.

💰 Tax Implications for Home Buyers

Buying a home is a major financial move—and while it often comes with upfront costs, there are long-term tax benefits you can take advantage of:

1. Mortgage Interest Deduction

If you itemize your deductions, you can typically deduct the mortgage interest paid on loans up to $750,000. For most Livingston County homeowners, this applies to standard mortgages on primary residences.

2. Property Tax Deduction

You may also be able to deduct a portion of your property taxes, up to a $10,000 cap (state and local tax deduction). Keep in mind, Michigan’s property taxes vary depending on the local municipality, but in Livingston County, rates are generally considered moderate compared to neighboring counties.

3. Points & Closing Costs

Some closing costs—like points paid to lower your interest rate—may also be deductible in the year you purchase the home.

✅ Local Tip: Always consult a CPA or tax advisor familiar with Michigan property laws before filing, as deductions may vary depending on your unique situation.

💸 Tax Implications for Home Sellers

Selling your home? You might be on the hook for capital gains taxes—but the good news is that many sellers in Livingston County qualify for exclusions:

1. Capital Gains Exclusion

If you’ve lived in your home for at least 2 of the last 5 years, you can exclude up to $250,000 in profit if single—or $500,000 if married—from capital gains taxes.

2. Home Improvements

Did you make improvements to your property before selling? Keep your receipts! These costs can be added to your home's basis, potentially reducing your taxable gain.

3. Selling Costs

Realtor commissions, title fees, and other closing costs can reduce your gain, lowering your tax liability.

✅ Pro Tip: Even if you don’t owe taxes, it’s still smart to keep thorough records of your home’s purchase, sale, and any improvements made over time.

📍 Local Real Estate Market Update – July 2025

The Livingston County real estate market continues to show signs of steady activity this summer. Inventory remains tight, with homes in areas like Howell, Brighton, and Hartland receiving strong buyer interest—especially those priced under $450,000.

Interest rates have held relatively stable in the low 6% range, though many experts believe a slight drop could come by fall if inflation trends continue downward. This stability is creating opportunity for both buyers and sellers to act confidently.

➡️ Sellers are still seeing multiple-offer scenarios in well-priced segments.
➡️ Buyers have more breathing room than in previous years, but competition remains for move-in-ready homes.

If you're thinking of buying or selling soon, now is a great time to have a conversation. There are financial strategies—including tax planning—that we can explore together to help you make the most of your move.

👋 Final Thoughts

Buying or selling real estate isn't just about moving—it's about building wealth and protecting your financial future. If you're unsure how your move will impact your taxes, I’d be happy to connect you with trusted local professionals who can help.


Ready to make your next move in Livingston County? Let’s talk today.