Definitions for "Tax savings"
If you itemize your tax return, you will probably be able to claim a deduction for the interest you have paid on your mortgage loans, including home equity lines of credit. A deduction is the amount you are allowed to subtract from your taxable income. It reduces the amount of your income on which you must pay taxes.
Items that lower your taxable income. Also, the value of the tax deduction you receive by deducting interest payments to your mortgage and home property taxes. For example, if you have $900 in interest and $100 property taxes per month, the monthly value of the tax deduction would be $280 with a tax rate of 28%.
Tax savings are the amount you may save in taxes from a tax deduction or credit that you would otherwise pay if you did not have the deduction or credit. Tax savings are also called a tax shield. You may wish to consult a financial or tax adviser. For businesses, tax savings are realized on such deductible expenses as lease payments, interest on loan payments, and depreciation expense.