By itemizing deductions on your tax return, you are choosing from the many individual tax deductions, instead of taking a flat-rate deduction. In some cases, itemizing deductions can save you money on your taxes. Deductions that can be itemized include medical expenses, property taxes, charitable contributions, mortgage interest and many more.
If you won’t be able to get your paperwork filed by the April deadline, you will need to file a tax extension. This will give yourself and your tax preparer more time to file, ensuring that there is no missing or inaccurate information. It may work better for everyone’s schedule and by filing for an extension you will avoid any failure-to-file penalties from the IRS.
Home improvements made during the same calendar year as selling the home can offer some tax relief from any profit made during the sale. For 2019 there is also one big tax credit for adding energy efficient systems to your home, including solar, geothermal or fuel cell technologies. Improvements done to a home office are also tax deductible.
Your tax bracket, which can change from year to year, is determined by your annual income. The progressive income tax system we use means that the more money you earn the higher the tax bracket for this additional income. This does not mean that you pay a higher rate on all of your income, but only that income which fall into subsequent tax brackets.