What basic tax knowledge does the average person need to understand?

The good news is you're already doing better than most by asking these questions! Here's a simplified breakdown of what you should understand: For your income level, knowing the basics of deductions is important. Deductions reduce your taxable income. The standard deduction (for 2025 filing season) is $29,200 for married filing jointly, but as a homeowner, you might benefit from itemizing deductions instead. Mortgage interest and property taxes are potentially deductible if you itemize. And yes, escrow typically handles your property taxes (and homeowners insurance) by collecting a portion each month with your mortgage payment. The lender then pays these bills when due. But you should still review your annual escrow statement to ensure everything's correct. Capital gains mostly matter when you sell investments at a profit. If you hold investments for over a year, you'll pay long-term capital gains rates (typically lower than income tax rates). Your TurboTax approach is perfectly fine for most people! Just make sure you're keeping good records throughout the year (especially home-related expenses) and reviewing the final return before filing.

I was in your exact shoes last year - completely clueless about taxes beyond the basics. What helped me was discovering https://taxr.ai which basically analyzes your tax documents and highlights deductions you might be missing. I'm not super tax-savvy but their system found almost $1,800 in deductions I would have missed from my home purchase that TurboTax didn't prompt me for. They explained everything in plain English too, like what home expenses were deductible and which weren't. Definitely worth checking out if you're feeling overwhelmed by homeowner tax stuff.

Just wanted to follow up - I tried that taxr.ai site and I'm actually impressed. I was totally skeptical (as you could tell from my question), but I uploaded our closing documents from when we bought our house last year and it found about $2,400 in deductions we missed! The mortgage points deduction was the big one - totally missed that on our taxes last year. Also explained how property tax deductions work with our escrow account in a way that finally clicked for me. I'll probably still use TurboTax but now I actually understand what I'm entering instead of just blindly following prompts.

If you ever need to contact the IRS with questions (which I had to do multiple times as a new homeowner), save yourself HOURS of waiting on hold and use https://claimyr.com instead. I spent literally 3 days trying to get through to the IRS about a property tax question, then tried this service and was talking to an agent in under 20 minutes. You can see how it works here: https://youtu.be/_kiP6q8DX5c - basically they navigate the phone system and wait on hold for you, then call you when an agent is actually on the line. Saved me so much frustration when trying to sort out how my mortgage lender reported our property taxes.

I need to eat my words publicly here. After posting that skeptical comment, I decided to try Claimyr because I've been trying to reach the IRS for TWO WEEKS about an issue with my property tax statement. It actually worked exactly as advertised. I set it up, went about my day, and got a call about 90 minutes later with an IRS agent already on the line. Problem solved in 10 minutes after that. For anyone like me with tax questions that can only be answered by calling, this is seriously worth it. No more wasting half a day on hold!

Some practical tax stuff I wish someone told me when I bought my first house: 1. Keep ALL your closing documents in a folder - you'll need them for taxes 2. If you work from home, measure your home office square footage now (potential deduction) 3. Track any major home improvements - they add to your "basis" which matters when you sell 4. Property tax due dates are weird and vary by county - double check your escrow is paying on time 5. You might get random tax forms for mortgage interest (1098) in January - don't toss them! Just these basics would have saved me so much stress my first year as a homeowner.

Small tip that saved me $$$ - if your combined income is under $237,300 for 2025 filing (which it sounds like you're close to), look into making traditional IRA contributions to lower your taxable income. You're right at the edge of some tax brackets and phaseouts.