![]() ![]() ![]() Property tax records: You can generally deduct up to $10,000 of state and local real estate taxes from your taxable income, with the exception of government assessments for improvements to your property, such as sidewalks or sewage lines.This form lists exactly how much mortgage interest you paid during the tax year, and you can use it to determine your deduction. A 1098 form: Your mortgage lender is required to send you IRS Form 1098 after the end of each tax year if you paid more than $600 in mortgage interest.If you do decide to go this route, start by making a checklist of what you plan to itemize. However, it’s important to note that if you elect to itemize these deductions, you forego the standard deduction amount. This means that you may be able to deduct both the property taxes and interest paid on up to $750,000 of mortgage debt from your income taxes. If You’re a New Homeowner…Īs a new homeowner, you have the opportunity to save money on home-related expenses. The tax brackets for the 2022 tax season are the same as they were for 2021. There are seven brackets - 10%, 12%, 22%, 24%, 32%, 35%, and 37%, - and yours will depend on whether you’re filing as single, married, or head-of-household. For example, if you paid mortgage interest and real estate taxes, made significant charity donations, had major out-of-pocket medical bills, or experienced uninsured damage from a fire, flood, or theft, itemizing might work best for you.įinally, it’s important to note the tax bracket that you fall into. While the majority of taxpayers claim the standard deduction, and it’s generally a faster and easier route, there are some instances that make itemized deductions a better option. For taxes due this year, the standard deduction increased to $13,850 for single filers, $20,800 for heads of household, and $27,700 for married couples filing jointly. Fortunately, you’re able to pick whichever option cuts your tax bill down the most. When filing your taxes, you have the choice to claim the standard deduction, which reduces your income by a set amount, or itemize your deductions, which consists of a list of eligible expenses. Here’s everything you need to know as a first-time homeowner filing federal taxes. While there is a lot of truth to this quote, there can be a lot of uncertainty if you are filing taxes for the first time after you’ve purchased a home. To quote Benjamin Franklin, “In this world, nothing can be said to be certain, except death and taxes.”
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