Did you know that the most significant days of your life can have a huge impact on your taxes? It doesn’t matter whether you are buying a new home, or you are going to get married, be ready that your financial situation will also be changed. Of course, you must have tons of questions, and we will gladly answer to all of them in this blog. So, lets try to figure out the most considerable occasions which can completely change your tax life.
Marriage is considered to be one of the most important decisions in every person’s life. However, with this new status, several tax-related changes occur. One of the most vital steps that you have to implement in the process of tax filing, is to ensure that your filing name matches with the one, mentioned on your Social Security card. So, if you decide to move, do not forget to update your address during your next tax filing process. Another important decision that you have to make is to figure out how you and your spouse will file this year, since you can do it both jointly and separately.
Having or Adopting a Child
The other crucial occasion which can turn your life around is becoming parents. Along with changes in your sleep habits and another costs, which can have a huge impact on your budget, you can also face several changes in your taxation process. Therefore, the first thing, that you have to consider by welcoming a new member into your family, is their Social Security Number. At first sight, it is a tiny aspect, however you should not underestimate this factor since this data provides you with an opportunity to claim your child on your next return. Additionally, you are given the chance of taking all the benefits of the federal child tax credit, and applying for deductions for childcare expenses.
Buying a New Home
If you are planning to buy a new home, then you should rush to itemize your return. There are lots of deductions available for the purchaser, such as real estate taxes, private mortgage insurance, and qualified home mortgage insurance.
Changing a Job
It’s a rule of thumb that each year, the majority of taxpayers has a certain sum of money withheld from their paychecks. So, if you decide to change your current place of employment, then you should file the Form W-4 in order to prepare for your next tax filing period in a proper way. And one more thing: get your refund collected during the period that you have worked in your previous workplace, it’s also important!
Getting a Divorce
Another crucial decision that can influence the entire process of tax filling of both sides is the divorce. That’s why it is so important to understand the tax implications of your marriage annulment. Thus, if your marriage status is “single” by December 31, then you can file your taxes separately, even if you have been filing jointly during the year.
Our life is full of events and changes; therefore, it is extremely important to be aware of all the benefits available for your status. So, if you are a changeable person you should be more careful towards your taxes. Prestige Auditors will in turn do all the possible and impossible actions in order to simplify your tax life.