A Friendly Reminder About Tax Records
February 15th, 2009 Posted in Real Estate
I know you don’t really want to be reminded as I, too, hate this time of year, but it is time to pay your taxes or get a refund if you’re lucky.
If you purchased, refinanced or sold your home during 2008, don’t forget to provide a copy of your HUD-1 Settlement Statement to your tax preparer. This document is hidden somewhere amongst the myriad of papers provided to you by the title company at close of escrow, and at the bottom left-hand corner, you will see “HUD-1.” This is a breakdown of all fees and points associated with your loan. Some fees and/or points paid may be tax deductible. Check with your tax professional.
Also, please, please, please, do yourself a favor! Save all receipts for improvements to your properties in a safe place, and keep them on all homes you have owned forever — okay, at least while you are alive.
This last year when my mother sold a large ranch and downsized back into a retirement home in town, I was aghast to find out she had not kept any receipts (not even one!) on the improvements to this property that started as a vacant parcel 20 years ago.
Fortunately, she has many photos of the improvements which will help if she is audited, but the best proof of improvements made to your properties is receipts for the supplies and work performed. This could save you — or your family after your passing — many thousands of dollars in capital gains when you decide to downsize and retire.
In all cases, if you have any questions about tax deductions, contact a professional tax adviser…
If you would like to search the MLS for listings in and around Paso Robles, visit my website. If you have any real estate questions or general questions about Paso Robles or San Luis Obispo North County, please contact me via email or call me at (805) 235-0234 for more information.
It starts with a dream…
Tags: home ownership, HUD-1, paso robles, retirement, San Luis Obispo, tax professional, tax records, taxes