5 Good Reasons to Amend Your Tax Return

Your home is a great source of tax savings if you know what qualifies, and don’t forget to claim deductions and credits. If you missed any of these five, you can go back in time — roughly two to three years — and amend your tax return.

1. Home Office Deduction

If your home is your principal place of business, you can take a standard deduction or deduct a percentage of eligible home expenses like utilities, mortgage interest for the portion of the house used as your office and home maintenance and repairs.

Visit www.irs.gov/forms-instructions to obtain the required forms to file an amended return.

2. Residential Energy Tax Credit

If you installed energy-efficiency improvements (like HVAC systems, insulation, a roof, windows) in in past years and didn’t take a tax credit for those upgrades, you may have missed out on up to $500.

3. Home Improvement Sales Tax Deduction

If your state and local town doesn’t tax income, you can amend Schedule A to deduct state and local sales tax you paid. Say you added new siding for $10,000 and your state charged 6% in sales tax. That’s potentially a $600 deduction.

Use the IRS’s online sales tax calculator to figure out the total sales tax you can deduct. Have the receipts to prove you paid the sales taxes.

4. Property Tax Deduction

Get a copy of your tax bill payment from the local tax office that collects the bill. Make sure you deduct the property tax expense on your amended return for the year you paid it, which could be different than the year it was due.

5. Home Repair Deduction

Red alert: You can’t claim deductions for any old home repair. There are only two narrow, possible ways to claim home repairs, and it’s always best to check with a tax pro for your particular situation:

• If part of your home is used for business and you aren’t taking the standard deduction for your home office: You can only claim repairs made to your home office or claim a percentage of the repairs you make to the house as a whole, like repainting or patching a roof leak.
• If 10 percent of your home is office, you can deduct 10 percent of the repainting or patching. If the repair is to the office itself only, then the percentage generally does not apply.
  

Note: You can claim losses from federally declared disasters either in the year they occur or, if it’s more favorable, on the preceding year’s taxes.

REALTOR® Association of the Fox Valley : 433 Williamsburg Ave., Geneva, IL 60134 : 630.232.2360 : http://www.rafv.realtor