Will we have a tax refund??

Question

We purchased a house this year and we have one child, will we get a refund or will we have to pay in?? Also, what is itemizing? What should we be sure to take with us when we file?

Answer 1

There is no way to tell from the info you provided if you will get a refund. You should take these documents with you to your CPA to prepare your return:
*W-2s
*Closing statement on purchase of house
*Mortgage interest statement
*Real estate tax payment support
*Child's social security number
*Documentation of unreimbursed business expenses/mileage
*Documentation for child care payments
*Medical expense receipts
*Charitable contribution receipts
*If you own a business, documentation for income and expenses
*Investment statements
*Any notices received from taxing authorities

That should be a good start.

Itemizing is when you compare certain actual expenses to the standard deduction permitted by the IRS. In order to have enough actual expenses to itemize, one usually has to be a home owner since interest expense and real estate taxes are part of the itemized expenses (along with state and local taxes, charity, medical expenses, unreimbursed business expenses, and other misc. items).

Answer 2

No way to tell, it depends among other things on your total income and on how much you had withheld. A refund is just a return of an overpayment - if you had too much withheld, then you'll get it back as a refund.

When you file a tax return, you have an option of taking an amount off of your income known as a standard deduction before you figure your taxes. If you "itemize", you list the items you paid that are allowable deductions, and use that total instead of the standard deduction. Common deductible items are mortgage interest and real estate taxes, state and local income taxes, and charitable contributions.

When you go to your tax preparer, take along anything you get in the mail that says "tax information" on it - W-2's or 1099's - you'll get a form from your mortgage lender that will have the amounts you paid for interest and probably for real estate tax - take your closing statement for the house - take any receipts for charitable contributions.

The standard deduction for a married couple filing a joint return for 2007 is $10,700, so unless your deductible items total more than that, you won't itemize. Many people think that having a house will save them a huge amount in taxes - not usually true. If your total itemized deductions is $15,000 and you're in a 15% tax bracket, your tax savings would be $645.

If you got a refund last year and not much has changed other than the house, you'll likely get a refund this year also. If you bought the house fairly late in the year, it probably won't make any difference. If you bought at the beginning of the year, it might make a little difference but not much unless you have a HUGE mortgage.

Answer 3

Q. Will we have a tax refund??
A. Maybe. You did not provide enough information to know.

Q. We purchased a house this year and we have one child, will we get a refund or will we have to pay in??
A. You did not provide enough information to know. This depends on how much you made and how much was withheld from your pay.

Q. Also, what is itemizing?
A. Deducting things such as medical expenses, employee business expenses, real estate taxes, things stolen from you, interest on your mortgage, etc.

Q. What should we be sure to take with us when we file?
A. All W-2 and 1099 forms. Receipts for anything that you think you might be able to deduct.

Answer 4

If you had too much withheld, you will get a refund. If you didn't, you will owe. There are way too many variables to give you an exact answer.

Having a kid and buying a house will reduce your taxes but they will not guarantee you a refund.

Bring the closing paperwork (HUD-1 Statement) with you when you get your taxes done this year.

Answer 5

Can't tell from information provided.
Before going to a tax preparer, ask him or her what documents are going to be needed. Many will have a tax organizer form to guide you.