Condominium and Townhome owners can deduct real estate taxes and mortgage interest on their federal income taxes but co-op owners cannot take these deductions.

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Condominium and Townhome owners can deduct real estate taxes and mortgage interest on their federal income taxes but co-op owners can also take these deductions. However, co-op owners cannot deduct property taxes and mortgage interest as separate items. Instead, these expenses are included in the co-op's operating costs and are factored into the monthly maintenance fees that the co-op owner pays.

Condominium and Townhome Owners Can Deduct Real Estate Taxes and Mortgage