Housing Taxes?

Question

I just recently bought a home 6 months ago, how will i do taxes on the house, what duductions can i file and what form do i fill out? If i do taxes at HR Block will the do housing taxes for me? And do you get a return or do you have to pay? sorry if these sound like dumb questions.

Answer 1

They're not dumb questions at all!

On your taxes you get a standard deduction or itemized deductions, whichever is larger. When you own a house, your itemized deductions often will add up to more than what's allowed as a standard deduction ($5000 last year, $10,000 if married filing joint). If you itemize, you also get to add in other expenses like real estate taxes and state and local income taxes - and there are other items also. Medical expenses can count, but only the amount that exceeds 7.5% of your income, so unless you had a real bad run of med expenses, you probably won't get that. Contributions to recognized charities count..Since you just owned the house part of the year, you might or might not have enough this year to itemize, but definitely check it out. And if you don't have enough this year, you probably will next year.

To itemize, you'll file a schedule A with your 1040. You'll get a statement from your mortgage holder showing the total interest paid, and if your taxes go into escrow as part of your payment, will show taxes also. And take along your closing statement - there will probably be some items there that might be deductible.

H&R Block will be easily able to do the itemizing. It will cost you a little more than your standard-deduction returns have.

As to refund or having to pay, that depends on your total taxes and what you had taken out. If you made about the same as last year, and had about the same amount withheld, you won't come out any worse, since if your itemized deductions don't add up to more than the standard deduction, you get the standard.

Good luck.

Answer 2

You will receive a 1098 from your mortgage company at the end of the year. This form will show the interest and property taxes paid during 2006. Bring this to Block along with your W2s and your taxes will be done before you know it. As you bought in 2006, I would bring your closing paperwork from the house also. Occasionally, there are some deductable items on it that are not on the 1098.