Using Your Tax Return for Home Improvements

Are you expecting to receive a tax return in the mail in the near future? Or maybe you’ve already received your return and are wondering how best to use it. Either way, you’re sure to be doing yourself a favor if you choose to re-invest your tax return in your home. Not only can you make your home look and feel better than it already currently does, using your tax return on your residential property can go a long way in boosting its value should you choose to put it on the market in the near future.

$100

Maybe you don’t want to use all your tax refund to upgrade your home, which is perfectly fine; there’s a lot you can do with just around $100. For instance, you can have a professional technician come out and service your HVAC unit to keep it operating in tip-top condition, which you’re sure to appreciate during the upcoming winter and summer months. You can also preserve the appearance and functionality of your driveway by having it sealed. Simply installing new handles or knobs on your cabinets can also do wonders for the appearance of your kitchen without a drastic and extensive renovation.

$500

For about $500 of your refund, you can install a backsplash in your kitchen as a way to reinvigorate the look of one of the most commonly used rooms in homes. Backsplashes can go along a single wall in your kitchen, such as behind the stove or the sink, allowing you to go as big or as small as you’d like with a generous variety of options for your preferences and personal budget. You can also choose a room in your home to receive a new coat of paint for $500 or so. If you haven’t done so already, insulating your attic is an excellent way to boost your home’s energy efficiency and your comfort level, so reach out to local roofing companies to see if they can help.

$1,000

Imagine what it will look like to have a brand new front door, one that offers greater security and the peace of mind that comes with it, which is exactly what you can have for about $1,000 worth of your tax refund. You might also like the idea of getting a new toilet, refrigerator, water heater or another appliance in your home that’s started to reach the end of its life cycle. We’re sure you’ll agree with the idea that it’s better to replace such expensive and essential appliances on your own terms and in your own time rather than become victim to sudden breakdowns that need to be addressed as soon as they happen.

Don’t Forget About Deductions

While you’re deciding which upgrades to make, bear in mind that some of them might qualify for a federal tax deduction the next time tax season rolls around. Energy-generating systems like geothermal heat pumps, solar panels, solar water heaters and small wind turbines might all qualify for a tax credit. Just make sure you do your research to see which credits still apply for the time in which you plan your installation. It’s also a great idea to consult with a tax expert, such as an accountant, about how much you can expect to receive and the specific year in which you need to take the tax credit.

Before you start looking at vacation destinations or planning a fancy dinner with your spouse or family, think about the long-term gain of utilizing your tax refund on your home. Unlike a shopping spree, a new gadget or an impulse buy, using your refund on residential improvements can repay you over the years.  

 

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