10 Ways to Use Your Tax Return for Home Improvements
Which Home Improvements Should You Use Your Tax Returns On?
Tax season. If you’re getting a return, it’s like celebrating Christmas in April. But if you owe the government, it’s the most dreaded time of year.
If you happen to be one of the lucky ones, you’re probably thinking of how best to use that annual windfall. For many, using their tax returns to make some much-needed home improvements is the answer. Sound like a plan? Here are ten of the best ways to use your tax return money for home improvements.
#1: Replace Your Siding
If your home’s siding is need of updating and you’re getting a nice tax return this year, then this might be the time to replace your home’s siding with a more updated version. The best you can get at the moment is fiber-cement siding. It’s not cheap, though. The average job costs over $13,000, but it does come with the benefit of 80% of its cost being recouped in home value.
#2: Replace Your Entry Door
Replacing your entry door instantly transforms your home’s entry. And going with an all-steel door adds even more beauty, security, and value. In fact, replacing your old worn entry door with an all-steel model allows you to recoup 102% of what you spend.
#3: Replace Your HVAC
Your home’s HVAC system is one of its most expensive appliances and if you’re like most people, you just don’t have the spare money to have it replaced. But you might when your tax return comes in. And because of the cost of replacing it, a new HVAC system is one of the first things home buyers look for when comparing homes.
#4: Update the Bathroom
The bathroom is one of the home’s smallest rooms, but it weighs mightily in the minds of buyers. This is why updating the bathroom is always a good choice for your tax return dollars. And the good thing is, it doesn’t have to be an expensive update. Simply changing some fixtures, updating the paint or wallpaper, and re-grouting the tiles will provide a dramatic improvement.
#5: Replace the Garage Door
Replacing a weather-beaten garage door with a mid-range model costs around $1,300. But simply updating the garage door adds almost $1,100 to the home’s overall value. Making this improvement will allow you to recoup about 84% of the cost.
#6: Have a Wood Deck Installed
A wood deck adds to the usable space your home has to offer, and this is what home buyers are often looking for. The typical professional deck installation costs around $11,000 but it recoups about $8,000 in the value of your home. With 73% of the cost recouped, a wood deck is a smart investment that will allow you to enjoy your home to the absolute fullest.
#7: Replace Windows
Drafty old windows can really compromise a home’s value. But replace them with newer windows, and your home’s value will skyrocket. In fact, replacing your windows will offer a cost recoup of about 73%. But even more importantly, your new windows will help make your home better insulated and more comfortable year-round.
#8: Do a Minor Kitchen Remodel
At an average cost of over $21,000, even a minor kitchen remodel can be costly. But, the kitchen is one of the most important rooms when it comes to evaluating a home’s market value, so money spent here is money well spent. On average, you can expect to recoup 73% of whatever you put into your kitchen.
#9: Convert the Attic Into a Bedroom
Converting an attic space into a bedroom is quite an undertaking, but adding another bedroom to your home will add value and appeal. This is another costly job, with the average project costing over $51,000, so you might need a little more than your income tax return to do it. But it will add as much as $38,000 in resale value to your home.
#10: Convert the Basement Into a Livable Space
Converting the basement into a livable space is the granddaddy of home improvement projects. Whether you want to turn you basement into a bedroom, a game room, or some other livable space, you can expect to pay an average of close to $65,000. But in doing so, you’ll recoup 70% of that cost in home value.
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