AHS Tax Guide

SAVE

April

18

THE AHS®

TAX GUIDE

LIFE IS STRESSFUL. At American Home Shield®,

we get that. Which is why we make it priority to reduce
hassles and headaches any time and any way we can.
Filing your Federal Taxes is especially stressful, so what
better time for us to put our money where our mouth is?

Use the tips and advice in the AHS® Tax Guide as
a starting point to help make things less hectic on
Tax Day. BE SURE TO CONSULT YOUR LEGAL, TAX
OR FINANCIAL ADVISOR FOR PERSONALIZED
PROFESSIONAL ADVICE.

COMMON
MISTAKES TO AVOID

Nobody’s perfect. Even tax professionals can make
mistakes. Unfortunately, even small mistakes on
your taxes can be costly. While they might not
result in you owing more, they could reduce or
delay your refund, or raise red flags with the IRS,
which is never a good thing. Being extra careful
and double-checking a few things before you file is
crucial. When beginning your tax preparation, here
is what to watch out for:

COMMON
MISTAKES TO AVOID

Missing the return deadline Name misspellings

Normally, the tax return filing deadline is Yes, even in filing taxes, spelling counts. In
April 15, but this year is different. Due to the fact, the IRS is a real stickler for spelling and
Washington D.C. Emancipation Day holiday when the names of a taxpayer, a spouse or
being observed on April 15 (instead of April 16, their dependent children don’t match the
2016), Tax Day is on the following Monday, April Tax ID number issued by the Social Security
18, 2016. Administration, it causes major problems.
This might seem like an unlikely problem, but
However, don’t wait too long to get your return it’s actually quite common for newly married
prepared for the 2015 tax year. Because of the women who take their partner’s last name or
reporting and filing requirements prompted a divorcee who opts to revert to her maiden
by the Affordable Care Act, you or your tax name. Whatever name you choose is fine. Just
professionals may need a little extra time than don’t forget to tell Uncle Sam. The IRS can kick
in the past. out or slow down processing the tax return if
there’s a spelling or name discrepancy.
If you still can’t get your tax return finished by
then, you must file for an extension in time. Clerical errors
You’ll need to complete Form 4868 by the
deadline. This will give you a 6-month reprieve These can be simple miscalculations or you
to get your forms completed (which is Monday, might accidentally transpose numbers from one
Oct. 17, 2016 since the usual deadline of Oct. 15 form to another. Using a tax software program
is a Saturday). to file your return can help reduce errors
because it may catch inconsistencies, but you’ll
Filing status issues still need to make sure your original numbers
are correct. 
This relates to your marital status, whether or
not you are the head of household, and if you It’s not that unusual for a taxpayer to write in
are married, whether or not you are filing jointly the wrong Social Security Number either. So
or separately, etc. There are 5 options in all, so if you don’t know your 9-digit number or the
make sure you determine your filing status SSNs for claimed dependents (or even if you
correctly before you prepare your return. think you do), make sure you’ve recorded them
correctly on ALL forms.

To learn more money-saving tips and tricks, check out the Home Matters Blog.

COMMON
MISTAKES TO AVOID

Over estimations and F orgetting charitable
underestimations contributions

This applies to things like taxable income, These are allowable deductions that can
earned income credits, the taxable amount of reduce your tax obligation, as long as you
Social Security benefits, etc. You have to know meet the standards, i.e., giving to recognized
what you’re working with at the start to make tax-exempt charities, donating items that are
sure you get to the right number in the end. in good to better than good condition, without
over-inflating their fair market value. See more
F ailing to report about other allowed tax deductions in the
additional income “Stake your Claim on Tax Credits” section.

You may have had what you considered a Leaving off your
“side job,” but to the IRS that’s just another John Hancock
word for “taxable income.” So you’ll need to
complete a Form 1099 or possibly a Schedule Even in this digital age, you must remember
C. The same thing applies to income earned to sign and date your return. Taxpayers
from investments or savings accounts. If you filing electronically must sign the return
fail to report these on your return, you could electronically using a personal identification
be subject to penalties and owe interest on the number, or PIN. If you are filing jointly with
unreported earnings. your spouse, you both must sign. There’s
nothing worse than going through all the
trouble of preparing your tax return and then
making the mistake of not signing or dating it.
This is usually the last thing you do, but keep it
top of mind.

To learn more money-saving tips and tricks, check out the Home Matters Blog.

REFUND $
$
DO’S & DON’TS
$
If you happen to get a refund, congratulations!
That’s a wonderful thing. It’s always nice to get
something back. But, before you rush out and spend
it, be sure to read these helpful Do’s and Don’ts.
They may help your refund grow even more.

$
$

$
$

$ REFUND DO’S & DON’TS REFUND DO’S

$ Save your refund Reduce your debt
$
This is the perfect time to build up If you are like many Americans,
your emergency fund. If you don’t you have debt. It could be
have one, start one. You never student loans, mortgage loans,
know when an unexpected car or balances on credit cards that
expense, costly home repair or carry high interest rates. Whatever
medical bill will bust your debt you have, it’s always best
bank account. to pay it down as quickly as
possible. Your refund might only
If you add to your savings mean you can reduce the balance
account, that money can build a little or it may help you pay it
over time and someday be used off completely. Either way, you’ll
for larger expenditures, like a benefit by reducing the interest
down payment on a car, a trip or you would otherwise be paying.
home improvements. If you plan If you do this, you’ll have more
wisely and don’t spend beyond money in your bank account in
your means, you won’t have the long run.
to max your credit cards and
increase your debt. That’s Improve your home’s/
always best. car’s energy efficiency:

Save for retirement This can be a win/win. If your
with an IRA home is still running with worn
out appliances or it’s been a while
The truth is, none of us know since you’ve replaced the roof,
what will happen with the Social windows or insulation, upgrading
Security System, so saving for to more energy-efficient options
retirement is always a good idea. can save you money in the long
While it might be tempting to term by reducing your heating
contribute to your child’s college and cooling costs. Plus, in the
fund instead, many financial short term, there are many tax
advisers will tell you there are
other ways to fund education incentives, rebates and credits
(like scholarships and loans), but for purchasing energy efficient
not retirement. You have a few products. The same is true for
different options, so be sure to electric or hybrid vehicles, which
consult with a financial adviser to can help save on fuel costs,
learn more about the differences reduce harmful emissions and
between traditional IRAs and often afford you a sizeable
Roth IRAs. tax credit.

To learn more money-saving tips and tricks, check out the Home Matters Blog.

$ REFUND DO’S & DON’TS REFUND DO’S

Consider an American Give to charity
Home Shield Home
Warranty Plan Making charitable donations is
rewarding in a couple of ways.
Household breakdowns Obviously, it’s a kind gesture
are inevitable. Unlike most that’s gratifying for the giver, but
homeowner’s insurance, an AHS donations are often tax deductible,
Home Warranty Plan covers the too. When you give to recognized
repair or replacement of major charities, you’re not only helping
components of home systems and others, you are making a wise
appliances, like your plumbing tax decision. Just be sure to keep
or HVAC, when they break down your receipts/bank records, an
due to normal wear and tear. An itemized list and follow the IRS’s
unexpected household breakdown
can be a real blow to your budget. requirements for charitable
An AHS Home Warranty Plan is deductions. In the meantime, check
a way to make those costs more out these 8 tips for making your
manageable and could save you donation count.
hundreds or even thousands
on repairs and replacements.

Download our Home Warranty
Guide to learn more.

$
$

To learn more money-saving tips and tricks, check out the Home Matters Blog.

$ REFUND DO’S & DON’TS REFUND DON’TS

$ S pend what you don’t course, there are exceptions to
$ have… yet every rule. If you need to buy a
car to maintain employment or
They say you shouldn’t count have no other viable means of
your chickens before they hatch. transportation, then do what you
The same holds true for tax must. If you have to use your
refunds. Remember, until that refund for a down payment, put
refund is deposited in your bank more money down to reduce your
account, you technically don’t recurring monthly payments and
have a refund. Postpone spending use your exemplary credit history
until the funds are actually firmly to negotiate the best rate and
in your account. terms you can.

Spend it on wants Loan the refund to
instead of needs friends

As we explained above in “The They say, “With money you can
Do’s” section, your refund might buy all the friends you want, but
be better used to pay down debt, they are never worth the price.”
save for retirement or invest in Loaning money to friends can put
sensible home improvements. a strain and unspoken tension on
your relationship. Unfortunately,
Of course we all have wants, but small claims court is full of former
you might regret blowing your friends who fell out over these
refund on that shiny new “want” kinds of well-intended loans. But,
instead of that boring old “need.” if you are feeling generous and
would like to gift your refund
Increase your debt to friends, by all means do. As
long as it is truly given freely,
It’s not always easy or even with no strings attached and
possible, but living within your no expectations of repayment,
means is a truly wise investment your friendship is sure to last.
in your financial future. It’s not Just a word of caution … you
advisable to use your refund as may get more “friends” than you
a down payment on a new car bargained for.
or home that will only mean you
have more debt each month. Of

To learn more money-saving tips and tricks, check out the Home Matters Blog.

STAKE YOUR CLAIM ON CLAIMS

TAX CREDITS

Making sure you claim all your eligible federal
tax credits can help you keep more of your
hard-earned money and may mean you can
substantially reduce your tax obligation.
Depending on what you qualify for and what
you claim, this could save you hundreds, even
thousands of dollars on your 2015 Tax Return.

STAKE YOUR CLAIM ON CLAIMS

TAX CREDITS

The government allows deductions, tax As a homeowner, you may have done some
breaks and credits for a variety of things. home improvements to enhance your home’s
Some are related to life circumstances like energy efficiency. Many of these federal energy
for families and parents. Others are related efficiency tax credits apply to items you
to homeownership, retirement or medical would’ve purchased in 2015 and some have
expenses or to make healthcare more been extended through the end of 2016.
affordable. Low- or moderate-income workers
have special tax credits for their unique These are tax credits for products across
circumstances, as do new and continuing more than 70 categories that have been
students. There are even tax credits for independently verified to save energy and the
environment. It can be anything from a new
Americans living or working out of the roof to insulation to certain windows, doors
country. Plus, many others that are too and skylights.
numerous to mention here.
Depending on the item, you may only qualify
With so many available credits, you’ll want for a tax deduction for your principal residence.
to be sure you’re taking advantage of all you In other instances, tax credits can apply to
can, but be careful. Tax laws are updated all purchases at a second home. So be sure to
the time. Before you make a claim, you’ll need look at the particulars before you file your
to confirm what’s been extended, added or return.
has expired since the last tax year. The good
news is, there are a variety of free online tools For the Tax Year 2015, the government has two
to help you know whether or not you would energy tax credits available: the Residential
even qualify for these tax breaks. Of course, Energy Efficient Property Credit and the
a certified tax professional can also be very Nonbusiness Energy Property Credit.
helpful in this area. After all, CPAs shouldn’t just
plug in your numbers on your tax forms. It’s And let’s not forget that purchasing an energy-
their job to know what laws change from year efficient vehicle in 2015 may qualify you for
to year and whether or not you would qualify the Alternative Motor Vehicle Tax Credit or
for claimed deductions. Qualified Plug-In Electric Drive Motor Vehicle
Tax Credit worth up to $7,500!

To learn more money-saving tips and tricks, check out the Home Matters Blog.

We certainly can’t promise that doing your taxes will
ever be fun, but it can be a little less stressful and
simpler with the AHS Tax Guide. And, of course, the
sooner you begin, the sooner you’ll be done.

To learn more money-saving tips and tricks,
check out the

HOME MATTERS BLOG.

THE AHS

TAX GUIDE

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