It’s that time of year again! As if you needed another reminder, the deadline to file your income taxes is just a month away. Cue the late-night number crunching, subsequent migraine, and celebratory pint of ice cream for when you’re finally done. There’s no getting around the fact that tax season is a complete pain in the you-know-what, but there is a silver lining – your refund. Cha-ching!
If you bought your home in Breckenridge within the past year, you may not realize how many amazing tax breaks you qualify for simply because you own property. For example, did you know that your mortgage interest is completely deductible, and that you can write off your property taxes? We’ll let your CPA fill you in on the details – it’s her job to make sure you get every possible deduction you qualify for.
With so many tax time benefits available to homeowners, there’s a good chance you’ll receive a fat refund check in the mail once your return is complete. According to the IRS, the average refund is now just over $3,000. While it may be tempting to blow that cash on a weekend getaway to Lake Tahoe (or Paris if your refund is jumbo-sized), consider reinvesting that money in your home to protect its value. Here are a few ways you can do that:
1. Replenish your emergency fund
The estimated annual cost of maintaining a home varies between 1% and 5% of the original purchase price. So, for a $500,000 home, you should have a minimum of $5,000 in the bank set aside for repairs and parts replacement. If you have the cash to fix little issues right when they pop up, you’ll prevent big problems down the road that could wipe out your account.
2. Get an energy audit and improve your attic insulation
A poorly insulated house is bad news for your heating and cooling bills. Use your income tax refund to get a professional energy audit and invest in fiberglass attic insulation. If you recall our list of top home remodeling projects for 2017, you know attic insulation trumps all. The average project cost is $1,268, and it provides a whopping 116% return on your investment.
3. Update your kitchen appliances
Unless you’re a home chef, updating your appliances probably seems like a boring use of your income tax refund. However, for $3,000, you could buy a new stainless steel refrigerator and wall oven to help boost the value of your home. Even if you can’t swing a full kitchen remodel, sparkling new appliances will give your abode that fresh, modern aesthetic homebuyers are looking for.
Are you starting to think about how you’ll spend that bonus paycheck coming in the mail? We’ve only scratched the surface of the many ways you can invest your tax refund in your home. Whether you’re updating your property to sell or are simply fixing it up for your own enjoyment, your house will thank you for giving it some TLC.
If you’re a renter and are intrigued by the exclusive tax benefits to homeownership, why not make 2017 the year you buy a home in Breckenridge? At Dwell Summit, we’d be thrilled to be your Breckenridge real estate agent and home buying guru. Give us a call when you’re ready to start the process!