Is Homeowners Insurance Tax-Deductible?

You can deduct part of your home insurance bill if you have a home office and own a business or work as a contractor. You can also write off home insurance and other expenses if you own a rental property.

In addition, you can write off your deductible and any damage not covered by insurance after a "federally recognized disaster."

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When is home insurance tax deductible?

There are two situations in which the IRS will allow you to write off all or part of your home insurance monthly premium:

However, you can't write off home insurance if you work from home but don't own your own business.

That means most people can't deduct their homeowners insurance payments on an income tax return. This applies to all types of personal home insurance, including hazard insurance, liability coverage and specialty insurance such as earthquake or flood coverage.

How to write off insurance if you work from home

There are two ways to write off your home insurance as a business owner with a home office:

Either method requires you to start by measuring your home office and calculating its square footage.

To write off your home office, you must use it regularly as your main place of business. That means you typically can't write off your home office if you have a separate office space outside of your home. That's because you'll be able to write off the office space outside of your home instead.

The simplified method

With the simplified method, you multiply the square footage of your office by a flat dollar amount.

In 2025, the standard deduction for a home office is $5 per square foot for an office up to 300 square feet. If you're doing your taxes by hand, you'll enter the total on line 30 of Schedule C.

The regular method

The regular method requires more work, but it could result in a larger deduction. To use this method, you must first figure out the percentage of your home used for business. Then, you'll use Form 8829 to calculate your deduction.

This can include things only used in your office space, like a desk, along with bills that cover your whole home, like homeowners insurance, electricity and internet bills. You'll multiply these bills by the percentage of your home occupied by your office to figure out your write-off.

For example, if your home office makes up 5% of the overall square footage of your home, you can write off 5% of your home insurance bill.

Regardless of which method you choose, you can only write off your home insurance if all of your combined deductions — including mortgage interest, medical care costs or education expenses — are greater than the standard deduction. Otherwise, your accountant or tax software will automatically apply the standard deduction instead.

What is the standard deduction for 2025?

A home business might require additional insurance coverage

A standard homeowners insurance policy may not cover all of your business equipment or inventory. Or, it may not cover the type of business you run at all.

For example, if you run a small stationery business out of your apartment, most homeowners insurance policies will cover related business materials such as paper, computers and pens up to a few thousand dollars.

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But, if you operate a daycare out of your home, your insurance company will probably require you to add extra coverage or get a separate commercial insurance policy. In this case, you should be able to write off the full cost of extra coverage or commercial policy since its only purpose is to protect your business.

How to deduct home insurance costs for rental properties

There are three main situations in which you can write off rental home expenses:

You own a separate rental home

That's because home insurance is a business expense in this scenario. Landlords can also write off other insurance policies for their rental business, such as an umbrella policy expanding their liability coverage.

You rent out a portion of your own home

You can also deduct a portion of your homeowners insurance if you rent out part of the home you live in. Similar to writing off costs associated with your home office, you'll have to calculate the square footage of your rental space, then figure out what percentage of your home it represents.

Let's say you rent out a basement apartment in a 2,500-square-foot home. If the apartment is 500 square feet, you can write off 20% of your home insurance bill.

You rent out your vacation home while you're away

There are a few important rules that determine whether you can write off some or all of the home insurance costs for your vacation home.

How to write off your insurance deductible after a disaster

You generally can't write off damage to your home. However, there is an exception for damage caused by severe weather during a federally declared disaster.

If your insurance company pays the full amount to fix your home, you can't write off the amount of the claim settlement on your taxes.

However, if the insurance company only pays for some of the damage, you can write off the difference. This amount may include your homeowners insurance deductible, as well as wear and tear if you have actual cash value coverage on your property.

You may not deduct the cost of home improvements that go beyond the cost of repairs. So if you spend extra money to improve your house to a better condition, those extra costs aren't tax-deductible.

Other tax deductions for homeowners

Aside from homeowners insurance, there are many other tax benefits for homeowners. Depending on your situation, these can include:

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Frequently asked questions