Things each homeowner should do each year.

1. Get your home appraised or have a Realtor give you a free market value.

Your home is your single most important investment. Do you know what your home is worth today? If not, then it is time to get it appraised by a licensed real estate appraiser or better yet ask a realtor for a Free Market Value on your home. Every year your home goes up in value due to appreciation and a appraiser or realtor will tell you what that value is by comparing your home to other similar homes that have sold in your neighborhood.

2. Check your mortgage payment book to determine how much equity you have in your home.

Each month your lender calculates how much of your monthly payment goes toward principal and interest and shows you what your loan balance is on your mortgage. The difference between what you owe on the mortgage and the market value described above is your equity in the home. Your last statment of the year will usually calculate how much interest you have paid during the year along with real estate taxes paid. Both interest and real estate taxes are deductions you are allowed to take each year on your taxes.

3. Add up those bills paid each year on home improvement.

All expenses paid each year for home improvement are tax deductable in the year that you made the improvements. It is a good idea to keep a record of these expenses for the future because when you sell you are able to deduct improvements made from the cost basis (original purchase price of your home).