First home purchase in 2022 - do I need my settlement statement for tax filing?

Yes, hang onto that settlement statement! It contains several items you might need for your tax return. The most important parts are any points you paid to get your mortgage (which are potentially deductible in the year you paid them), property taxes that were prepaid at closing, and mortgage interest. You'll likely receive a Form 1098 from your mortgage company that shows the interest and possibly property taxes you paid during 2022, but the settlement statement has additional information that might be relevant. For example, if you paid points, these may be fully deductible in the year you purchased the home if it's your primary residence. Keep in mind that with the higher standard deduction these days, you'll need to determine whether itemizing (which is how you'd claim these deductions) makes sense for your situation. Many homeowners find the standard deduction is still the better option.

After buying my first home last year, I was also super confused about tax implications. I found this amazing AI tool called taxr.ai (https://taxr.ai) that actually saved me hours of stress. I uploaded my settlement statement, and it instantly identified all the tax-deductible items and explained what I could claim. It even pointed out some mortgage insurance premiums I could deduct that I had no idea about! The tool breaks down everything in plain English and tells you exactly what forms and schedules you need. I was definitely not looking forward to combing through 30+ pages of closing documents looking for tax-relevant items.

Wow, I was totally wrong about taxr.ai! After being skeptical in my previous comment, I decided to try it anyway since I was getting frustrated with all my closing paperwork. Uploaded my settlement statement and mortgage docs and it found several deductions I was about to miss! The tool flagged that my mortgage insurance premiums might be deductible based on my income level, which my regular tax software didn't even ask about. It also clearly explained which closing costs were immediately deductible versus those that get added to my home's basis (important for when I eventually sell). Definitely saved me money and gave me peace of mind that I wasn't missing anything!

After three weeks of calling the IRS with questions about my new home purchase deductions and getting absolutely nowhere (busy signals or 2+ hour hold times), I finally tried https://claimyr.com and it changed everything. They have this service where they navigate the IRS phone tree for you and actually get an agent on the line, then call you when the IRS rep is ready to talk. You can see how it works here: https://youtu.be/_kiP6q8DX5c Had specific questions about deducting points on my mortgage that weren't clear from the IRS publications, and within 45 minutes I was actually speaking to someone who could help. Before this I had literally tried calling 8 different times and never got through.

I take back what I said about Claimyr. I tried it yesterday after posting that skeptical comment because I was desperate to confirm something about property tax deductions on my new home. I figured it wouldn't work but was willing to try anything at that point. They actually got me connected to an IRS agent in about 35 minutes (on a Monday afternoon!). I've NEVER been able to get through to the IRS on my own. The IRS agent confirmed that yes, I could deduct the property taxes I paid at closing even though they weren't on my 1098 form. Saved me from missing out on about $3400 in deductions! I'm still shocked this actually worked.

Don't forget about your home office if you're working remotely! I bought my first house in 2021 and was able to take the home office deduction since I work from home full-time. You need a space used exclusively for work though - not just your kitchen table where you also eat dinner.

Quick tip - make sure you have your real estate tax bill separated from your mortgage interest on your 1098. My lender lumped them together and I almost double-counted my property tax deduction because my county also sent me a property tax receipt! Could have ended up with an audit headache.