Turn Your Taxes Into Savings for Married Couples

By Richard Warner

I have been an investor and landlord for 5 years. When I got my official real estate license, I started as a First Time Homebuyer Specialist and have since received specialization certifications in Luxury Homes, Probate, and Divorce.

I think it’s safe to say that the word “tax” has a negative connotation in general. If possible, we will look for ways to save on taxes, which is why today, let’s talk about how you could save money when tax time comes around.

Disclaimer: While I have years of experience as a licensed Realtor and developed an understanding of some of the tax benefits you should be aware of, I highly recommend getting advice from your trusted tax advisor in Kentucky for more in-depth information about your personal tax situation.

That being said, here are the top three tax strategies when starting a family:

1. Filing jointly. When you are married, you can file your taxes together as a single entity. Filing jointly gives you a higher tax bracket, double that of those who are single. Aside from a higher tax bracket, you can also get capital gains exclusion when you sell your house if you’ve lived there for two out of the last four years. You can potentially sell your home tax-free up to a certain amount.

2. Tax deductions. These are claiming costs that reduce your taxable income, keeping you in a lower bracket. For example, you and your spouse move in together and have furniture that you don’t need. Donating some of it to charity will get you a receipt deduction. If your donation amounts to $6,000, this amount will be deducted from your taxable income, potentially keeping you in a lower tax bracket. Other deductions include mortgage interest, property taxes, childcare expenses, and even a home office if you work from home (up to about 300 feet). Other deductibles are energy-efficient upgrades such as solar panels, windows, certain kinds of heaters, air conditioners, and water heaters.

3. Tax credits. Unlike deductions, this is like free money from the government if you meet certain criteria. One of the most popular and common ones is the child tax credit, which allows you to claim $2,000 for every child under 17 years old. Earned income tax credit is also subject to tax credits if you are a low-income earner. This is also applicable in the context of marriages that are filed jointly, especially if one spouse is working and the other is taking care of the kids full-time. Tax credits are also applicable if one partner is a student under the Lifetime Learning and American Opportunity tax credits.

Filing jointly and taking advantage of deductions and tax credits allows you to reduce your taxable income and pay less in taxes. If you are interested in how all of these work but still have questions, reach out to me anytime by phone or email, and I’ll help you out. You can also visit my website: howtoaffordhomes.com. I look forward to hearing from you!