If your return is fairly simple and you’re up for the challenge, preparing your taxes solo could save you a bit of money. In fact, an estimated 33% of Americans file their own taxes each year, so if you’re ready to join their ranks, here are a few tips for getting through the process.
1. Prepare your return early
2. Figure out whether you’ll be itemizing this year
“The new federal tax law created a lot of confusion over whether tax filers may still deduct the interest they pay on their home equity loans and home equity lines of credit.
“The new law suspends the deduction for interest on home equity indebtedness for the next eight years.
“But it turns out the suspension does not apply to all home equity loans (HELs) and lines of credit (HELOCs). It just applies to those that are used to pay for non-home-related things, like paying off your credit card or buying a car. But you can still deduct home equity loan interest that is used to pay for home improvements…”
“It’s been almost six months since Equifax announced a massive data breach that exposed personal information for as many as 145 million Americans.Cyber thieves could use that data to open up credit cards, take out loans, or carry out a medical theft.
“But many Americans aren’t being proactive to protect their financial well being. Half of adults in the U.S. haven’t checked their credit report or score in the last six months, according to a survey from CreditCards.com…”
Buying a house instead of renting is, depending where in the country you live, often more cost-effective. But upgrading from a smaller home to a larger home and mortgage? Probably not.
“There are solid reasons to upgrade your home. For many, it was always the plan. You buy a starter home, and upgrade to a larger one once your family expands. Or your income expands, and you finally move into your dream home. Regardless of your reason, the typical first step is determining what you can afford. A standard rule for lenders is that your monthly housing payment (principal, interest, taxes and insurance) should not take up more than 28% of your income before taxes. A quick and dirty way to check how much you can afford is through calculators like myFico calculator.