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Receive a Tax Refund? You May Want to Consider Home Improvements

Tax season is upon us once again. As of February 12th, many Americans are trying to get their taxes filed early in hopes of getting a refund from Uncle Sam. If you’re one of the taxpayers who does receive a tax refund this year, it’s hard to resist making spur-of-the-moment choices. 

Instead, think about putting that money into your home. Home improvements may increase your home value for the future. Tax refunds come in all sizes, and so do home improvements! Here are a few suggestions:

  • Tax refunds under $500:
    • Refresh your paint  
      • A simple refresh or change in paint color can invite a new perspective 
      • Instead of painting a whole room, create an accent wall
    • Replace the cabinet hardware in kitchens and bathrooms
      • You can give your bathrooms and kitchens a new look by replacing the cabinet pulls and handles
    • Makeover your entryway
      • Elevate the look of your entryway by painting the front door a bold color, installing good lighting, buying a rug, or adding plants
    • Install a smart thermostat
      • Controlling the temperature of your home is as easy as the click of a button on your smartphone and can save you money on your monthly utility bill
  • Tax refunds of $1,000:
    • Add a backsplash to your kitchen
      • Adding a backsplash provides an instant transformation ​and can be as simple as buying peel and stick wallpaper
    • Enhance landscaping
      • Landscaping can both increase the value and enjoyment of your home
    • Upgrade appliances such as the refrigerator, dishwasher, or stove
      • Stainless steel appliances convey a clean and contemporary design and may give the appearance of an updated kitchen
  • Tax refunds of $3,000 or more:
    • Add an outdoor patio
      • Extend your living space or spruce up your current one by adding a fire pit, outdoor seating area, or freestanding grill
    • Install new kitchen countertops
      • If you’re looking for a serious investment, you can upgrade your kitchen countertops to quartz or granite

This past year has been an unconventional year and many Americans are wondering: Is my stimulus payment taxable?

“The short answer is No. The longer explanation from the IRS is ‘No, the payment is not income and taxpayers will not owe tax on it. The payment will not reduce a taxpayer's refund or increase the amount they owe when they file their 2020 or 2021 tax return. A payment also will not affect income for purposes of determining eligibility for federal government assistance or benefit programs.’ (Waggoner, AARP, 2021).”  Read more on this topic here. 

Don’t delay! You have until April 15th to file your taxes.