Tax-ing ? here~?

Question

Hi..I am a new homeowner (massachusetts)..what do I need for taxes for next year? What do I need to save..what do I need to bring with me..etc? I am so confused with taxes ....now even more so...help..any advice ?

know any websites that will help?

thanks in advance for serious answers....!

Answer 1

You need to bring us EVERYTHING related to your income - your W-2s, your mortgage statement, your property tax bill, any information regarding any interest on any bank accounts or other savings plans. If you own your own business you need to bring us all the information on your expenses for the year and your income for the year. Please try to categorize these so your tax preparer doesn't go crazy. If you have expenses related to working for an employer - you need to bring that to us also. If you own rental property we need ALL the information on that. Also bring anything you get in the mail that says "IMPORTANT TAX DOCUMENT".

Answer 2

Last years info, (Income reporting forms - W2s, 1099s, K-1s, etc) plus your end of the year mortgage interest statement, Form 1098, issued by the lender. It will show property tax paid on your behalf, and the interest you paid.

Since you probably didn't filed a 1040 Schedule A, Itemized Deductions, prior to having a mortgage, look at this schedule to see what things are deductible from you gross income, and which ones apply to you. There are detailed instructions if you need them later, but looking at the forms is a far less stressful adventure to start.

I have put IRS links in the source section which will give you access to the forms you should download and peruse.

Now some advice for the future, when you may want to sell your house. Currently the tax law is very generous with a tax free exemption of $250K profit for each individual - double for a married couple - when you sell a residence you have lived in for at least two years; it may not always be so. Keep a notebook with expenditures that are not currently deductible to improve your home. These are called capital improvements and increase the tax cost of the home when you sell it. (Selling price minus tax cost = profit) These must be improvements and not just replacing things YOU wore out. Replacing worn out items in your newly purchased older home qualify as do costs for an addition, upgrading, landscaping, a new fence and many other improvements.

The IRS website is becoming very user friendly, and if you have any questions or there is something I haven't addressed e-mail me. Relax, and you'll catch on in no time. Good Luck

I'm a CPA and a homeowner.