As a Realtor in the Neponset Valley corridor, I’ve seen many homeowners in Dedham, Norwood, Walpole, Medfield, Millis, Norfolk, and Medway navigate complex tax scenarios. Here are eight common tax mistakes to avoid, based on insights from HouseLogic (read their full article here)

1. Deducting the Wrong Year for Property Taxes: Ensure you deduct property taxes in the year they were actually paid, not when billed.

2. Confusing Escrow with Actual Taxes Paid: Only deduct the actual amount of property taxes paid, as shown on your Form 1098.

3. Deducting Points Paid to Refinance: Spread refinancing points over the life of the loan, rather than deducting them all at once.

4. Misjudging the Home Office Deduction: Use the simplified method or consult a professional to avoid IRS scrutiny.

5. Failing to Repay the First-Time Homebuyer Tax Credit: Repay the credit as required to avoid penalties.

6. Failing to Track Home-Related Expenditures: Keep detailed records of home improvements and expenses.

7. Forgetting to Report Capital Gains: Declare gains from home sales accurately to avoid unnecessary taxes.

8. Claiming Too Much for Mortgage Interest: Ensure your loan doesn’t exceed the $750,000 limit for deductions.

By avoiding these mistakes, you can maximize your tax benefits and minimize potential audits. Always consult a tax professional for personalized advice.