2024 » Brock CPA
Accounting Budgeting Taxes

Tax Benefits for Homeowners: Exploring Deductions and Credits in Florida

May 7, 2024

Tax Benefits for Homeowners: Exploring Deductions and Credits in Florida

While headlines may focus on rising interest rates and housing costs, homeownership in Florida remains a sound long-term investment. Owning a home offers stability, potential for appreciation, and a variety of tax benefits that can ease the financial burden. At Brock CPA, we’re here to help Florida homeowners navigate the ever-changing tax landscape and maximize their deductions and credits in 2024.

 

Why Homeownership Makes Sense in Florida

Despite recent market fluctuations, Florida’s housing market exhibits resilience. According to the Florida Realtors® https://www.floridarealtors.org/tools-research/reports/florida-market-reports, median sale prices are expected to remain steady in 2024, offering predictability for homebuyers. Additionally, Florida’s lack of state income tax makes it an attractive location for homeowners looking to keep more of their hard-earned money.

Owning a home also fosters a sense of community and allows you to personalize your living space. Long-term, homeownership can contribute to financial security as the property value potentially appreciates, building wealth over time.

 

Tax Advantages of Homeownership in Florida

Florida homeowners hold a distinct advantage: the Homestead Exemption. This exemption significantly reduces the taxable value of your primary residence, translating to lower property taxes. According to the Florida Department of Revenue https://floridarevenue.com/property/Pages/Taxpayers_Exemptions.aspx, the exemption can be as high as $50,000, offering substantial savings.

 

Federal Tax Deductions for Homeowners

Beyond the state level, homeowners across the U.S. can benefit from various federal tax deductions in 2024:

  • Mortgage Interest Deduction: A portion of the interest paid on your mortgage loan can be deducted from your taxable income. The Tax Cuts and Jobs Act of 2017 limits this deduction to the interest paid on mortgages up to $750,000 for new loans issued after December 15th, 2017, and $1,000,000 for loans issued before that date https://www.irs.gov/forms-pubs/about-publication-936.
  • Mortgage Points Deduction: Points, which are upfront fees paid to secure a lower interest rate, can be deducted in the year they are paid if certain criteria are met https://www.irs.gov/forms-pubs/about-publication-936.
  • Private Mortgage Insurance (PMI) Deduction: If you have a conventional loan with a loan-to-value ratio exceeding 80%, you may be able to deduct the PMI premiums you pay on your federal tax return https://www.irs.gov/forms-pubs/about-publication-936.

 

Important Note: Tax laws can be complex, and eligibility for deductions can change. It’s crucial to consult with a qualified tax professional at Brock CPA to determine which deductions apply to your specific situation.

Tax Credits Available to Florida Homeowners

While deductions lower your taxable income, tax credits directly reduce the amount of tax you owe. Here are some more potential tax credits for Florida homeowners in 2024:

  • Residential Property Insurance Premium Tax Credit (New in 2024!): Florida recently passed a bill offering a one-year tax credit for the cost of residential property insurance premiums https://www.flsenate.gov/Media/PressRelease/Show/4541. This credit applies to policies written between October 1, 2024, and September 30, 2025. Be sure to stay updated on the official application process for this new credit.
  • Energy Efficiency Tax Credits: The federal government offers tax credits for homeowners who install energy-efficient improvements in their homes. These credits can help offset the cost of upgrades like new insulation, high-efficiency windows, or solar panels https://www.energystar.gov/about/federal-tax-credits.

 

Additional Considerations for Florida Homeowners

  • Save Your Receipts: Keeping detailed records of homeownership expenses like mortgage interest, property taxes, and home improvement costs is crucial for claiming deductions and credits.
  • Consult a Tax Professional: Tax laws can be intricate, and Brock CPA’s experienced team can help you maximize your deductions and credits while ensuring compliance with federal and state regulations.

 

Owning a home in Florida is a significant financial decision. However, with its long-term value proposition, potential for appreciation, and various tax benefits, it can be a rewarding investment. By understanding and utilizing the available deductions and credits, you can significantly reduce your tax burden and make homeownership in Florida even more advantageous. Contact Brock CPA today to schedule a consultation and ensure you’re taking full advantage of all the tax benefits available to you.

Accounting Business Taxes

Understanding the 2024 Tax Brackets and Inflation Adjustments

February 15, 2024

Understanding the 2024 Tax Brackets and Inflation Adjustments

What are the Differences Between the 2023 and 2024 Tax Brackets?
Tax season can be a daunting time, and navigating the ever-changing world of tax brackets and deductions can feel like deciphering an ancient code. For those filing their 2023 taxes this year (due April 15, 2024!), and planning for 2024 filings, understanding the adjustments made for inflation is crucial. So, take a deep breath, grab your coffee, and let’s explore the key differences between the 2023 and 2024 tax brackets.

Hold My Bracket: Tax Rates Remain the Same, But Thresholds Shift

First things first: the good news! The tax rates themselves haven’t changed for either 2023 or 2024. That means you’ll still see the familiar progression from 10% to 37% depending on your filing status and taxable income.

However, to account for recent high inflation and prevent “bracket creep” (paying a higher tax rate due to cost-of-living increases, not actual income growth), the bracket thresholds have been adjusted upwards for 2024. This means you’ll need to earn more money to fall into the same tax bracket as in 2023.

Breaking Down the Increases:

The table below illustrates the changes:

Filing Status 2023 Thresholds 2024 Thresholds Increase
Single $215,950 – $539,900 $231,700 – $563,050 $31,100
Married Filing Jointly $539,900 – $647,850 $563,050 – $678,650 $15,600
Head of Household $539,900 – $647,850 $563,050 – $678,650 $15,600
Married Filing Separately $131,300 – $157,500 $137,050 – $160,750 $3,700
Single $539,900 and above $563,050 and above $23,150
Married Filing Jointly $647,850 and above $678,650 and above $30,800
Head of Household $647,850 and above $678,650 and above $30,800
Married Filing Separately $157,500 and above $160,750 and above $3,250

As you can see, the increases vary depending on your filing status, but generally range from $1,475 to $4,275. This means you could potentially fall into a lower tax bracket in 2024, even if your income increased slightly to keep up with inflation.

Beyond the Brackets: Other Adjustments to Know About

While the tax brackets are a major focus, keep in mind that other adjustments impact your overall tax liability:

  • Standard Deduction: The IRS also raised the standard deduction for 2024, which effectively reduces your taxable income. For single taxpayers and married filing separately, it increases to $14,600, while it climbs to $29,200 for married filing jointly and $21,900 for heads of household.
  • Other Tax Credits and Deductions: Be sure to explore other tax breaks that might apply to you, such as the Earned Income Tax Credit (EITC), Child Tax Credit, student loan interest deduction, and charitable contributions deduction. These can further lower your tax bill.

Consult a Tax Professional to Maximize Your Tax Benefits

Tax laws are continually evolving and can be complex. For many, if not most circumstances, seeking professional tax advice can ensure that you maximize your tax benefits, and navigate the intricacies of the tax code efficiently. For assistance with your tax planning, preparation and filing in Jacksonville, contact the professionals at Brock CPA by calling (904) 330-0268 or emailing dbrock@brockcpa.com. You can also information and resources on the IRS website: https://www.irs.gov/.

Brock CPA
Budgeting Business

Top Financial Resolutions for 2024: A Guide for Families and Businesses

January 18, 2024

As we usher in a new year, it’s the perfect time to think about our financial goals and set actionable resolutions for a more secure and prosperous future. Whether you’re an individual or a business owner in Jacksonville, Florida, these practical financial resolutions can help you navigate the complexities of the fiscal landscape in 2024.

1. Streamline Your Budget for Increased Savings
Resolution: Revamp Your Personal and Business Budgets

Begin the year by reviewing your spending habits and identifying areas where you can cut unnecessary expenses. Allocate those savings towards an emergency fund or investment opportunities.

2. Optimize Tax Efficiency with Strategic Planning
Resolution: Implement Tax Planning Strategies

Stay ahead of the game by working with a CPA to develop a tax planning strategy tailored to your unique circumstances. Leverage Florida’s tax laws to minimize liabilities and maximize deductions for both personal and business taxes.

3. Diversify Your Investments for Long-Term Growth
Resolution: Review and Adjust Your Investment Portfolio

Ensure your investments align with your financial goals and risk tolerance. Diversify across different asset classes to spread risk and capitalize on potential growth opportunities.

4. Establish or Enhance Your Retirement Savings Plan
Resolution: Contribute to Retirement Accounts Regularly

Whether you’re an individual setting up an IRA or a business owner implementing a 401(k) plan, consistently contribute to retirement savings. Take advantage of tax benefits associated with retirement contributions.

5. Strengthen Emergency Funds for Financial Security
Resolution: Build or Reinforce Your Emergency Fund

Unexpected expenses can arise at any time. Aim to have at least three to six months’ worth of living or operating expenses in an accessible emergency fund.

6. Leverage Technology for Financial Organization
Resolution: Adopt Financial Management Tools

Explore digital tools and apps that can help you track spending, manage budgets, and streamline financial processes for your personal or business finances.

7. Assess and Enhance Your Insurance Coverage
Resolution: Review and Update Insurance Policies

Ensure your personal and business insurance policies adequately cover your current needs. Consider factors like life changes, new acquisitions, or changes in business operations.

8. Improve Credit Score and Credit Management
Resolution: Check and Manage Your Credit Regularly

Check your credit reports for inaccuracies, then monitor regularly and work on improving your credit score. A healthy credit score can lead to better financing opportunities and lower interest rates.

9. Enhance Business Efficiency through Technology
Resolution: Invest in Technology Upgrades

For business owners, consider investing in technology that can enhance efficiency and productivity. This might include upgrading software, implementing cloud solutions, or adopting automation tools.

10. Prioritize Professional Financial Guidance
Resolution: Engage with a Trusted CPA

Whether you’re an individual or a business owner, partnering with a certified public accountant can provide valuable insights and customized financial strategies to help you achieve your goals. Meet regularly with your CPA to ensure that you are doing everything you can to further your aims.

Setting realistic and achievable financial resolutions is a great first step toward a financially successful year. Tailor these suggestions to your specific circumstances and, when in doubt, call the professionals at Brock CPA to help you navigate the intricacies of Florida’s tax laws and your financial journey. Here’s to a prosperous 2024!