If you've purchased or sold a home in the last year, there are some important things to keep in mind as you prepare to file your taxes:
- Mortgage Interest Deduction: If you purchased a home in the last year, you may be able to deduct the interest you paid on your mortgage.
- Property Tax Deduction: If you purchased a home in the last year, you may be able to deduct the property taxes you paid.
- Capital Gains Exclusion: If you sold a home that you lived in for at least two of the past five years, you may be able to exclude up to $250,000 (for single filers) or $500,000 (for married couples filing jointly) of the capital gains from your income.
- Moving Expenses: If you moved for a new job or business, you may be able to deduct some of your moving expenses, such as the cost of moving your household goods and the cost of transportation, including lodging.
- Points: If you purchased a home and paid discount points on your interest rate, they may be deductible as mortgage interest, but it depends on the circumstances.
It’s important to keep all documents and receipts related to your home purchase or sale, such as closing documents, mortgage interest statements, and property tax bills. If you purchased or sold a home with us in the last year, Sun American can also help get your settlement statement for you!
Other Helpful Hints:
- Gather all other necessary tax documents: This includes things like W-2s, 1099s, and other forms that show income and tax-deductible expenses.
- This tax form or that tax form? : Depending on your income and tax situation, you may need to use a different form than you have in the past. For example, if you’re self-employed, you’ll need to use a different form than if you’re an employee.
- Other tax deductions and credits: As mentioned, there are many tax deductions and credits available that can lower your tax bill. Some additional common deductions include things like charitable donations, and state and local taxes.
- E-file, E-file, E-file!: It is very quick and will help you to avoid mistakes in the process.
