Here’s what you need to know to get ready for tax season this year.
It’s that time of year again: Tax season! While it may not be everyone’s favorite topic, being well-prepared can make the process of preparing and doing taxes as a homeowner much easier. Today, I’ll go over a few tips to make doing your taxes as easy as possible.
First, I recommend keeping a file of everything you do to your house, especially if you plan on living in it forever. It is always easier to establish the basis of your house if you have a good file of all the improvements made over time, including plumbing work, electrical work, painting, and roofing. Keep an easy-to-access file that people will know where to find it, just in case. The better and easier files you keep, the better off you will be in the long run.
For those with a mortgage on their home, the tax statements received from your lender showing the interest and taxes paid are easy forms to use that have all the necessary information. However, if you own your home free and clear, having access to your tax statements will be useful. This will allow you to know the property taxes you have paid throughout the year, which you can use as a deduction.
“Keep a file with all your relevant information. ”
If you purchased a home last year or in 2022, the settlement statement is the document that will show all the pertinent information that your tax preparer will need, including fees paid if you had a loan, points paid, and miscellaneous expenses.
If you purchased a rental property last year and received rent on it, there is a great opportunity for you with cost segregation. Talk to your tax professional about this, as there may be lucrative opportunities for you built into the tax code that incentivize real estate investment.
These are just a few things that can make your life easier during tax season. If you have this information available, you will be a step ahead of many people. If we helped you buy property last year and you need access to your settlement statement, we keep a file of that kind of stuff for you and are happy to help.
If you have any questions, do not hesitate to call or email. I am always available to answer any questions you may have. Have a wonderful day!
