Finding a CPA
Once you buy a home, your personal income taxes become just a bit more complicated to file.
That's why, finding the right CPA is important.
Meet AZ Moyer
"Anyone should be able to understand their tax situation and how to apply financial principles to their own business, without reading one thousand pages of tax code. The system is too hard and complicated. I make it easy to understand."
Normally, after becoming a homeowner, you are able to capture more tax deductions on your personal income tax return. You do this by itemizing your deductions versus taking the standard deduction, which is $12,550 for the 2021 tax year. If you live in Austin, your property taxes alone might cost more than $12,550, so get on the ball now and consult a CPA to find out how to maximize your personal income tax deductions!
Why is a CPA important?
The number one expense for Americans is taxes. Yet, we spend more time negotiating a car purchase than we do planning for our income tax bill. The right CPA can help you take full advantage of every tax deduction and tax credit available to you, based on your unique personal situation. Once you buy a home, using TurboTax is simply not as effective as engaging with a CPA.
Examples of deductions and credits for homeowners:
Once you sell your home, you may be liable for capital gains tax if your home appreciated from the time you purchased it. Ways to limit this tax bill are knowing that you can reduce your reportable gain, if certain criteria are met. All improvements made to your home add to your basis in the home, which lowers your eventual gain. You can also leverage a Section 1031 Exchange to defer capital gains tax.
As a new homeowner, you may be unaware of the homestead exemption you qualify for. Claiming this exemption reduces your property taxes, but this must be filled out each year before April 30th, and you must own you home as of January 1st of the tax year.
The first year of home ownership comes with lots of mortgage interest which qualifies as an itemized deduction.
If you are an entrepreneur and work from home, you may eligible for the business use of your home deduction.