6 Tax Deductions Homeowners Won't Want to Miss

Last year was a big year for Richmond's Real Estate Market! If you bought a home, you know how expensive it can become.  Take advantage of all that's afforded you this tax season, and deduct some of those homeownership costs!

6 Tax Deductions Homeowners Won't Want to Miss
By Maurie Backman, January 4, 2017

Though there are plenty of good reasons to buy a home, owning property can be a costly prospect. From maintenance to insurance to real estate taxes, there are numerous costs that come with buying a home. But one major upside to homeownership are the tax benefits that come along with it. If you're a new homeowner, here are six deductions you don't want to miss out on.

1. Mortgage interest deduction
Looking at your mortgage statement can be a demoralizing prospect during the early years of homeownership, especially once it becomes obvious that the majority of your payments are going toward the interest portion of your loan and not its principal. But before you get too down, remember: That interest will serve as a helpful tax deduction when the time comes to file your taxes. You can deduct interest on up to a $500,000 mortgage as a single tax filer or $1 million as a couple filing jointly.

2. Home improvement loan interest deduction
Looking to spruce up your home? You might get a tax break for it. If you borrow money for the purpose of making home improvements, you can deduct whatever interest you pay on that loan with no upper limit. The only thing to keep in mind is that your loan must be used for capital improvements to your home, not repairs. If you borrow money to put up a new fence, finish your basement, or build an addition, you can deduct whatever interest you pay on your taxes. But if you take out a loan to repair a leaky roof, you won't be eligible for a deduction.

3. PMI deduction
Many homeowners aim to make a 20% down payment to avoid getting hit with private mortgage insurance Opens a New Window. , or PMI. But if you're stuck paying PMI, there's some good news: You can deduct your premiums provided you don't make too much money. The PMI deduction starts to phase out when you earn $50,000 a year as a single tax filer or $100,000 as a couple filing jointly. And the deduction goes away completely when you earn more than $54,000 as a single filer or $109,000 as a couple filing a joint return.

4. Mortgage points deduction
Some borrowers pay mortgage points, which are up-front fees, in exchange for a lower long-term interest rate. A point on a mortgage is equal to 1% of the loan amount, so the higher your mortgage, the more you'll pay per point. On the other hand, points can serve as a tax deduction, either immediately or over time. If the points you pay are consistent with what most lenders are charging and you use your loan to buy your primary home, you can typically deduct the entire cost of your points right away. Otherwise, you'll need to spread out that deduction over the life of your loan.

5. Property tax deduction
The average U.S. homeowner pays a little more than $2,000 a year in property taxes, but in some states, that figure can be anywhere from two to five times as much (or more). And while nobody wants to spend a fortune on property taxes, they can serve as a nice tax break. If you're going to claim a property tax deduction, just make certain to do so the year you actually make your payments. Property taxes are often billed quarterly, so it could be that you pay the first part of your 2018 taxes at the end of 2017 -- in which case you'd take the deduction for the 2017 tax year.

6. Home office deduction
If you're self-employed and have a dedicated space in your home that you use for work purposes, you can claim a home office deduction against your income. To calculate your tax benefit, figure out how much you spend annually on costs like water, electricity, internet service, and homeowners' insurance. Next, calculate the amount of space your office takes up relative to your home, and then prorate your expenses to arrive at your deduction. For example, if you spend $3,000 a year on eligible expenses and your office takes up 10% of your home's total square footage, you can claim a $300 deduction.

Whether you're new to homeownership or have carried a mortgage for years, it pays to learn more about the tax deductions available. The more you're able to claim, the more cash you'll manage to pocket and keep away from the IRS.

Original article appeared on foxbusiness.com

Celebrate National Wine Tasting Day @ Secco Wine Bar

Did you know that November 5, 2016 is National Wine Tasting Day?  As an avid wine drinker, I was delighted to learn of the event and excited that it gave me an excuse to visit one of my favorite clients in Richmond serving my favorite beverage— Secco Wine Bar! Having recently moved to their new location (something we both have in common...) they've been able to expand their menu as well as their seating with a heated patio outdoors and more space inside.  Celebrate this holiday with me and go to your favorite local wine bar...as if you needed the excuse.

Payroll Clients of Accounting Works: Compliance Updates!

To Our Payroll Clients,

As part of your subscription to HRAdvisor, we monitor labor laws and compliance requirements. Governmental regulations have changed and may require your business to display new posters.  To get the updated posters, please log in to your payroll account and visit the Compliance Center.

To maintain your $25,000 compliance guarantee, you will need to download and post the new poster.

The compliance wizard will create one packet containing all of your updated posters. On the print screen, you can always choose not to print those posters that haven't changed since the last time you printed the posters.

Thank You!

How We Helped Design By E

It’s no secret that we help all kinds of businesses, big or small, reach their goals and find their individual success. We have clients from all different backgrounds and we’ve learned that no client is created equal. It keeps it interesting because we are faced with a variety of unique problems to solve and we love finding great solutions for our clients' financial future.

One of our newer clients, Design By E, is no different and they offered a new kind of challenge for us. They are a small firm who specialize in creative multimedia and marketing.  Despite being small, they experienced big growth in a relatively short amount of time. They were growing at an exponential rate and needed financial direction when they sought out the services of Accounting Works Solutions.

Having been the sole proprietor of the company, the founder, Enrique Mendez, was able to create a healthy budget for himself from the start. However, the unique and valuable services offered by the company quickly gained traction throughout the small business owner community in Richmond and he was able to acquire some pretty reputable clients in a short amount of time.

In order to keep up with their gain, Enrique hired two full-time employees and needed help organizing his company's financial future quickly as his business became more complex.

When they came to us, we were we able to analyze and figure exactly where their finances stood and write down a plan for them to budget for the future. The plan included setting money aside for taxes, savings and company growth.

We reached this plan by carefully looking at their profit margins and seeing where their strength and weaknesses lie. We asked them to pay attention to those areas where they were the most profitable and maybe adjust their strategy when it came to less profitable projects.

“Accounting Works Solutions really helped us take our business to the next level,” says Enrique.  “We found ourselves so busy with work that we often forget to pay attention to our finances. Stephen was a such a big help and crucial for our future as a company.  I feel confident going forward that we’re going to continue to be profitable!”

At Accounting Works, we not only offer accounting solutions but also financial planning for growing businesses. We’re excited to have a wide portfolio of clientele and will always do our best to help our clients be at their best. If you always find that your finances are the last thing on your list to worry about, it may be in your best interest to make sure that your business is operating the most efficient way possible. We can help you achieve those goals! It can save you hundreds and maybe thousands in the long run when you talk to an expert. So give us a call today and see if you’re the best you can be!

Move Update for Our Clients

We’ve moved!

If you haven’t heard by now, we made a big move last week! It has been an exhausting process but we believe this new location will better serve our customers!

However, this move has not been without some minor issues. We’re still waiting for our internet to be fully operational in the office so in the meantime we have maintained our servers offsite. As a byproduct of this particular issue, we experienced some email interruption last week, this has been corrected and we don’t expect this issue to arise again. If you have emailed us within the last week or so and have not gotten a response from us - don’t be alarmed! We weren’t ignoring you, we just may not have gotten it. We encourage you to email us again so we can promptly get back to you.

At this time, we have limited availability for appointments and expect to be fully functional on Tuesday, June 26th. If you are one of our payroll customers, don’t worry, payroll services have not been affected by our move.

To all our other customers, we appreciate your patience in this matter and please, if you have a time sensitive issue that needs to be resolved right away, don’t hesitate in calling us!

We will keep you updated throughout our transition to our new location so keep an eye out for any email updates that may come your way!

Thank you, we appreciate your continued business.

- Stephen Fishel

You can now find us at
122 Granite Ave
Richmond, VA 23226