In Pakistan, rental income is chargeable on the net income basis. A maximum of 4% of gross receipts are allowed as a deduction for collection and administration charges and there are grounds for insurance, local taxes, and ground rent allowances. Tax is collected (at source) by the tenant and is adjusted during the annual income tax return with the Federal Board of Revenue (FBR).

FBR’s Tax Slabs and Rates

    • Up to Rs. 300,000: 0% (Tax-Exempt)
    • Rs. 300,001 to Rs. 600,000: 5% for filers (10% for non-filers)
    • Rs. 600,001 to Rs. 2,000,000: Rs. 15,000 + 10% of the amount exceeding Rs. 600,000 (Non-filer: Rs. 30,000 + 20%)
    • Above Rs. 2,000,000: Rs. 155,000 + 25% of the amount exceeding Rs. 2,000,000 (Non-filer: Rs. 310,000 + 50%) 

How to File

  1. Tax Withholding by Tenant
  2. Online Filing
  3. Declare Income
  4. Attach Evidence
  5. Clear Balances

Income Tax Return for Rental Income in Pakistan

Is Rental Income Taxable in Pakistan?

Yes. Income earned from renting out of residential or commercial property is usually taxable in accordance with the provisions of the Income Tax Ordinance 2001. If they are mandatorily required to file their tax return under the tax laws of Pakistan, property owners need to declare their rental income in their annual income tax return.

Who Must File an Income Tax Return?

Which Properties Are Covered?

Which Law Governs Rental Income?

Quick Filing Process Through FBR IRIS

  1. Register or activate your NTN.
  2. Log in to the FBR IRIS Portal.
  3. Select the relevant tax year.
  4. Declare rental income under the Property Income schedule.
  5. Claim allowable deductions and adjustable withholding taxes.
  6. Complete your Wealth Statement.
  7. Submit the return and pay any outstanding tax through PSID.

Understanding Rental Income Under Pakistan Tax Law

What Is Rental Income?

Rental income is the income that is received from a property owner for the use of his or her property by another person or company in exchange for a rental fee. This can be rent for a house, apartment, office, shop, warehouse or any other commercial property.

Rental income is different to business income or salary income from a tax point of view. The kind of income and deductible deductions are decided as per the provisions provided in Income from Property.

Suppose a landlord is getting rent of Rs. 1000 per month for a land where the rent is paid monthly. The money from a business place in Lahore is considered property income and should be reported in the annual income tax return, if it is 150,000.

Income from Property Under the Income Tax Ordinance, 2001

According to Income Tax Ordinance, 2001, the rental income is classified under the head of Income from Property. The law sets out the framework for:

The FBR will be able to obtain information on rental income from banking records, withholding tax data, information about the ownership of the property, and other data that is available. This means it is important to have all documentation complete.

Residential vs Commercial Rental Income

Although both residential and commercial rental receipts fall under property income, there may be differences in:

Who Is Considered a Landlord?

A landlord may include:

Is Rental Income Taxable in Pakistan?

Yes, Rental Income is indeed taxable in pakistan. According to the Income Tax Ordinance, 2001, in Pakistan rental income is considered taxable income. The rental income from immovable assets (House, Apartment, Shop, Office, Warehouse etc.) may be mandatory to be reported in the annual income tax return to the Federal Board of Revenue (FBR).

The FBR classifies this income as an income from property as per the head “Income from Property. The tax debt, however, depends on several factors such as the level of rental income, deductible expenses, withholding taxes that apply to the rental income, and tax liabilities of the taxpayer.

Many landlords are under the misapprehension that rental income is not reportable as long as the tenant has already paid for the taxes. In fact, in most cases withholding tax actually acts as an advance or adjustable tax and in no way replaces the need to file an annual income tax return.

Who Must Pay Tax on Rental Income?

  1. An individual receiving rental income from one or more properties.
  2. A co-owner earning rent from jointly owned property.
  3. A company receiving rental income.
  4. An Association of Persons (AOP) earning property income.
  5. An overseas Pakistani receiving rental income from property located in Pakistan.
  6. A person already registered with the FBR or required to become a filer.

Taxable Rental Income Explained

The rental income may not be the same amount as the rental income that is taxable. Rather, it is normally computed after applying the provisions of the Income Tax Ordinance, any allowable deductions (if any) and any withholding tax already deducted (if any).

For example:

It will minimize the chances of getting a notice from the FBR and avoid any unwarranted conflicts.

Annual Rental Value

Annual Rental Value is the aggregate of the rent that may be received from property for one year (whether monthly, quarterly or annually). It is used as the basis to calculate property income which is subject to tax.

You should maintain:

Gross Rental Income vs Net Rental Income

The documents are used to support the rental income reported on your tax return.

Gross Rental Income – Net Rental Income

It’s important to know the difference between gross and net rental income.

Is Rental Income Ever Exempt?

The tax treatment of rental income may be impacted in certain cases by law, exemptions, and/or specific provisions made available for a specific tax year. But for the most part, rental property income is not automatically exempt for the landlords.

Check any legal provisions or get another professional opinion from a Professional Tax Consultant Lahore before claiming any exemption or deduction as it is possible to file a wrong return.

Who Must File an Income Tax Return for Rental Income?

Not all of the properties are subject to the same tax requirements. The filing requirements vary based on the ownership structure, annual income, tax residency and provisions of the tax laws in Pakistan.

Individual Property Owners

Whereas most individual Rental Property Landlords should check the amount of taxable income and FBR filing requirements.

If you have one or more home(s) that you rent out, make sure to report all rental income correctly on your return. For those who haven’t received their National Tax Number, it might be necessary to register on the IRIS portal with the help of an NTN Registration Services in Lahore or in the desired area first.

Joint Property Owners

When the property is owned jointly, each co-owner will typically allocate their own portion of rents as they wish to, based on the ownership agreement.

Keeping proper documentation and ownership records and rental agreements will prevent any disputes and incorrect reporting.

Companies Receiving Rental Income

In addition, companies with rental properties must report rental income on their annual corporate income tax returns. They must keep good accounts, rentees’ contracts, and accompanying financial statements.

Association of Persons (AOP)

However, Partnerships and Associations of Persons where there is rental income should comply with the tax rules and report property income in accordance with those rules.

Overseas Pakistanis Receiving Rental Income

There are a large number of foreign nationals who have property in Pakistan where they earn rental income. A significant number of foreign nationals have residential/commercial property in Pakistan with rent earnings. Rental income from property located in Pakistan can indeed have tax implications even if the property is located outside of Pakistan.

Having all the records and filing returns if necessary can prevent any future compliance problems particularly while selling the property or when contacted by FBR.

Advocate Shahid is known for his regular advice to clients who have property investments that they maintain comprehensive records all year long, which would be much easier than having to piece together records when they have received a notice from the FBR.

Legal Framework Governing Rental Income

Before filing an Income Tax Return for Rental Income in Pakistan it is crucial to understand the legal aspects. Income tax laws are administered under the Federal Board of Revenue (FBR) under the Income Tax Ordinance, 2001, Income Tax Rules, 2002 and IRIS Tax Portal. The laws do prescribe the tax liability on rental income, who should be making a tax return and the consequences of failing to do so.

These legal requirements can be a burden for both commercial property owners and residential homeowners, but they can be a source of potential penalties, audits and unnecessary litigation if not properly complied with.

Income Tax Ordinance, 2001

The basic and main Act in respect of income tax in Pakistan is the Income Tax Ordinance, 2001. It treats income from rents as “Income from Property” and provides the guidelines for:

Income Tax Rules, 2002

The Income Tax Rules, 2002 supplement the Ordinance and give procedural directions to apply the income tax laws. These rules provide guidance to taxpayers on matters relating to documentation, filing and administrative issues they need to follow when completing their annual returns.

Federal Board of Revenue (FBR)

The Federal Board of Revenue (FBR) is the authority which has the responsibility to oversee the Income Tax regime in Pakistan. Its responsibilities include:

The FBR also verifies the accuracy of the declared rental income by cross-checking property ownership records, withholding tax data, banking transactions as well as wealth statements.

IRIS Tax Portal

The IRIS Tax Portal is the official online platform used for:

The FBR IRIS Login Guide can assist you with understanding the FBR IRIS and prevent common filing errors if you are filing your return for the first time.

Commissioner Inland Revenue

The Commissioner Inland Revenue has statutory powers to:

If you are contacted by the Commissioner Inland Revenue, please respond within the time frame and submit full supporting documents, to ensure your legal rights are upheld.

Documents Required for Rental Income Tax Return

Having the necessary paperwork ready before you begin your return can help minimize mistakes in filing and help turn in your return faster. The most popular cause of delays is inadequate paperwork.

You can also download our checklist of documents for Income Tax Return Pakistan to know in detail what documents you need to submit if you have multiple income sources.

CNIC and NTN

Keep the following available:

If you haven’t registered for an NTN, do so before you try and file your return.

Lease Agreement

One of the most crucial documents to back your rental income is the written lease agreement. Be sure to include:

This document can be called for in an audit or in reply to an FBR notice.

Rental Receipts

Maintain copies of:

Bank Statements

Try to accept rentals via banking systems, not cash, if possible. Bank statements are a great way to prove rental income, and make reconciling with your tax return easier.

They also play a part in showing how transparent your return is when it’s chosen for review.

Property Ownership Documents

Make copies of documents proving ownership, including:

Property Tax Records

Maintain records of:

Utility Bills (Where Relevant)

Although utility bills are not always mandatory, they can support:

Withholding Tax Certificates

If your tenant has taken withholding tax as part of the rents received, get the withholding tax certificate. They will allow you to claim tax credits that are adjusted to your return and avoid double taxation.

Wealth Statement Information

Your declared rental income should be consistent with your annual Wealth Statement. Prepare details of:

One of the most frequently occurring discrepancies that trigger the issuance of notice by the FBR is between the income and wealth declared on the FBR Form. One of the most common discrepancies that leads to the issuance of notice by the FBR is the discrepancy between the income and wealth declared on the FBR Form.

Practical Tip from Advocate Shahid

In the practice of my law office as a tax lawyer, the number of rental income disputes I’ve encountered are not due to taxpayers intentionally hiding income from the IRS, but rather due to the lack of proper documentation. Having all the lease agreement, bank statements, rent receipts and ownership documents neatly put together throughout the year will make it easier to file and will have strong evidence if the FBR asks for it.

How to File an Income Tax Return for Rental Income in Pakistan (Step-by-Step Guide)

When you have all necessary documents and know the process, it is much easier to file an Income Tax Return for Rental Income in Pakistan through FBR IRIS Portal. No matter how many residential or commercial properties you hold, the correct procedure helps you to prevent the issue of notices, penalties and unnecessary delay.

The entire procedure of filing is outlined below, based on real experience in dealing with property tax cases before the Federal Board of Revenue.

1 – Register for NTN

Please make sure you have a valid National Tax Number (NTN) before submitting your income tax return.

Please fill up the Taxpayer Registration Form on IRIS Portal if you are not registered with the FBR. You usually need to bring the following to register:

2 – Activate Your IRIS Account

Once registered, log in your IRIS account by:

Make sure that you have an accurate profile before you get to the part where you return it.

3 – Log in to the FBR IRIS Portal

Access your account using:

The FBR IRIS login guide can assist you with avoiding some familiar technical blunders when you log on to FBR’s IRIS website for the first time.

4 – Select the Relevant Tax Year

After logging in:

One of the most frequent filing errors is filing U.S. tax returns for the wrong year.

5 – Enter Property Income

Navigate to the Property Income section of the return and provide complete details of your rental income.

Typically, you should enter:

6 – Declare Rental Income

Enter the total rental income earned during the relevant tax year.

Do not:

The amount declared must match with:

If you can report it accurately, then it reduces the risk that you will get an FBR notice for undeclared income.

7 – Enter Tax Credits and Withholding Tax

If you have the withheld taxes already paid by your tenant, employer, government department or company, then list those credits in the specific areas of the return.

Continue to retain information including:

8 – Complete Your Wealth Statement

For many taxpayers, the income tax return will be their main concern, and they will not think about the Wealth Statement.

Your Wealth Statement should include:

9 – Review Your Return Carefully

Before submission, review every section of your return.

Verify:

10 – Submit the Income Tax Return

Once you have reviewed all entries:

Keep a copy of your filed return and other documents.

11 – Generate PSID

If your return shows tax payable, generate a Payment Slip ID (PSID) through the IRIS Portal.

The PSID allows you to pay your outstanding tax using:

When paying for a vehicle, make sure that the payment information is correct before paying.

12 – Pay Outstanding Tax

Complete payment before the due date to avoid:

After payment, keep the:

Common Filing Mistakes to Avoid

Even experienced taxpayers sometimes make avoidable mistakes. The most common include:

Practical Example

Suppose Mrs. Sara owns:

She receives all rental payments through her bank account and maintains:

She enters all the rental income for each property on her return and records the difference between the rental income and the amount of the adjustable withholding tax that her corporate tenant withheld on the rental income, she reconciles her Wealth Statement, she calculates the remaining tax payable on the rental income and she submits her return prior to the due date.

Practical Advice from Advocate Shahid

In the 20 years I have worked with rental income, I have discovered that the majority of the issues regarding rental income disputes stem from the lack of documentation. Generally speaking, the landlords who maintain organized records, get rent through banking system and file income tax returns before the deadline have lesser issues while complying with the law. Where there are more than one property involved, where they are inherited, or where the FBR has sent a notice, it may be wise to seek professional advice before submitting a return.

How to Report Rental Income in FBR IRIS

Once you have determined your rental income, the next crucial step is to report the income properly on the FBR IRIS Portal. Notices are issued by the Federal Board of Revenue (FBR) to many taxpayers for not filing return even if they have filed a return in error or due to missing important information.

The IRIS system matches the data you enter with information from banks, withholding agents, property records and with your previous tax returns. Thus, consistency and accuracy is crucial.

Property Income Schedule

Within the Income Tax Return, locate the Property Income section.

Enter complete details for every rented property, including:

Income Declaration

Your declared rental income should match your supporting records.

Before submitting the return, compare the declared income with:

Tax Credit Adjustment

Numerous landlords don’t take advantage of tax credits.

If the tenant has already paid withholding tax, tell the taxman in the appropriate box of the return. This adjustment may help lower your overall tax bill.

Ensure you retain:

Withholding tax certificates
Bank payment records
Document from tenants that demonstrates the tax deduction.

Withholding Tax Entry

Companies, banks, government departments, and other withholding agents often deduct tax before paying rent.

When entering withholding tax information:

Wealth Statement Matching

Your declared rental income should be in line with the Wealth Statement.

If you have bought an investment property with rental income, for instance, this should be noted as a source of funds.

Some of the areas that are common are:

Residential vs Commercial Rental Tax

While both residential and commercial properties give income from property, there are important distinctions that landlords need to be aware of.

Tax Differences

Usually, residential properties are leased for personal lodging while commercial properties are rented for business uses.

There are several things involved when dealing with commercial properties:

Typically, residential properties will have less complex lease agreements and individual tenants.

Commercial Property Rules

Commercial landlords are required to keep a proper record as commercial tenants are “withholding agents” under the tax laws in Pakistan.

Recommended documents include:

They can be useful if the tax authorities audit your taxes.

Residential Property Rules

Residential landlords should also maintain complete documentation.

Keep:

While documentation requirements might seem more straightforward, rental income from a residence is also subject to documentation requirements.

Common Tax Mistakes

  1. Declaring only part of the rental income.
  2. Forgetting to disclose one property.
  3. Claiming unsupported deductions.
  4. Ignoring withholding tax adjustments.
  5. Using outdated lease agreements.
  6. Failing to update ownership information.

Withholding Tax on Rental Income

Many landlords don’t understand one important component with regard to rental income reporting – the withholding tax.

When Is Tax Deducted?

Where required by law, certain tenants deduct tax before making rental payments.

These commonly include:

The deducted amount of tax is mainly deposited at the Federal Board of Revenue.

Adjustable Withholding Tax

Withholding tax that’s deducted from the rent payments is deductible in many circumstances from the last income tax bill.

To get the adjustment, you must:

Not taking this deduction could lead to over-payment of taxes.

Claiming Tax Credit

While preparing your income tax return:

If any withholding tax is not in withholding system, contact tenant/withholding agent immediately to correct.

Common Withholding Errors

Frequently encountered issues include:

Wealth Statement for Landlords

One of the most looked at sections of an income tax return is the Wealth Statement. It provides an explanation of your assets, liabilities, income and expenses for the tax year.

Notices will be sent to many taxpayers who accurately report rental income but do not have enough income to be accurately supported on their Wealth Statement.

Why Is It Mandatory?

The Wealth Statement allows the FBR to determine whether:

If the wealth statements are not complete or up to date, they are likely to draw extra in-depth research.

Property Disclosure

Every landlord should disclose relevant assets accurately.

This may include:

If there has been a change in ownership either through sale, purchase, inheritance or transfer, ensure the ownership details are consistent with previous years.

Rental Income Reconciliation

The rental income declared in your tax return should reconcile with:

There may be compliance issues with the FBR if there are significant discrepancies.

Asset Growth Explanation

If you make a big purchase during the year, such as another rental home, you should be able to explain how you bought it (where the money came from), in that case.

Valid reasons could be:

Practical Advice from Advocate Shahid

In my practice, I have seen many instances where the landlord has filed a timely return but then notice has been served because there was a discrepancy between the landlord’s Wealth Statement and bank transactions and/or the declared rental income. It is best practice to keep full financial accounts all year round, collect all rents by banking and to check all figures before they are submitted.

If the case is not straightforward or involves several rental properties, any ownership complexities or inherited assets, you should seek professional advice prior to the submission of your case to avoid any costly errors and the laborious process with the tax authorities.

Common Mistakes While Filing a Rental Income Tax Return

Even seasoned landlords can make mistakes while preparing Income Tax Returns relating to Rental Income in Pakistan. The majority of the FBR notices are related to incorrect reporting, lack of documentation or mismatch in the tax return and Wealth Statement. These are common mistakes that you can avoid so that you don’t incur any unnecessary penalties, and don’t have to wait for a long time to receive a response from the tax authorities.

1. Not Declaring Rental Income

One of the biggest errors people can make is not reporting any rental income. Some landlords think that the tenant has withheld the tax, so they don’t need to report it. But withholding tax is not a substitute for a yearly income tax return.

Your return can be matched by the FBR with data from the withholding agent, bank and property information. The failure to declare rental income could lead to notices, further tax assessments and penalties.

2. Incorrect Property Value

Another common mistake is the incorrect property information or rental numbers.

Examples include:

Before you return the lease, make sure you have compared all the information with your lease agreement, rent receipts and bank statements.

3. Missing Lease Agreement

A lot of landlords agree with rentals orally and that makes it challenging for them to prove rental income in the event of an FBR inquiry.

When a lease is in writing, it will outline the following:

An up-to-date lease will put you in a better position should you be chosen to return your lease for an audit.

4. Incorrect Tax Calculation

There are various mistakes that can be made in the computation of rental income that may result to an underpayment or overpayment of tax.

Some common errors in calculations are:

For more complicated tax situations, professional assistance is suggested prior to filing.

5. Wealth Statement Mismatch

The Wealth Statement should be substantiated by the income reported on your return.

For example:

Sometimes, there are differences that are not explained, which leads to notices issued by the FBR.

6. Missing Tax Credits

A number of taxpayers do not receive “adjustable” withholding tax deducted by their corporate tenants, government departments or banks.

If you are preparing your return, check to be sure all withholding tax credits are properly entered and that there are tax deduction certificates to support the entry of the amount.

7. Late Filing

Late filing may carry a number of repercussions such as:

By filing before the Income Tax Return Deadline Pakistan, you can steer clear of these problems and ensure that you are tax compliant.

Common IRIS Errors and Their Solutions

The IRIS Portal has made the online filing process easier, but they still face difficulties in terms of technical and data entry. Knowing about these issues can make you save time and avoid frustration.

1. Rental Income Not Showing

If the rental income you have declared does not show as it should:

If it continues, go over your draft return before sending it out.

2. Tax Return Rejected

Returns are commonly rejected because of:

Please read each section and re-submit an appropriate response.

3. PSID Payment Not Updated

However, sometimes payments of tax do not show up instantly in IRIS Portal.

In such cases:

4. Wealth Statement Error

Wealth Statement errors usually occur because:

Before filing your Wealth Statement, make sure to review it carefully to be consistent.

5. Property Income Mismatch

If the difference is found between the rental income that you have stated in your declaration and the information provided by third party, a clarification notice may be issued by the FBR.

Use supporting evidence that can be easily accessed such as:

6. Amendment Procedure

FBR Notices Related to Rental Income

Tax evasion does not necessarily mean that a notice was received. Many times the problem can be solved with adequate documentation.

The reasons behind FBR issues Notices are discussed.

Why FBR Issues Notices

Common reasons include:

Undeclared Rental Income

If rental income has not been disclosed, the FBR may seek an explanation regarding:

These issues can be dealt with more effectively if responses are speedy and accurate.

Property Valuation Mismatch

The FBR may compare:

Where there is any inconsistency there must be documentary evidence to support it.

Income Concealment

If FBR suspects that income has been deliberately withheld, the relevant provisions of the Income Tax Ordinance, 2001 will be followed.

This risk can be greatly diminished with the help of complete and accurate records.

Responding to the Commissioner Inland Revenue

If you receive a notice:

Failure to comply with an FBR notice may have legal repercussions.

Penalties for Not Declaring Rental Income

If a landlord does not meet tax obligations, he/she could face a number of repercussions.

These may include:

Can You Revise Your Rental Income Tax Return?

Yes. Taxpayers can amend a tax return if they find any significant errors after filing an income tax return if the law permits.

It may be necessary to revise where:

Practical Tips from Advocate Shahid

In over 20 years’ experience with providing advice to landlords, business owners and property investors, I can make the following recommendations for best practices in tax compliance:

  1. Receive rental payments through banking channels.
  2. Keep signed lease agreements for every tenant.
  3. Maintain digital copies of all supporting documents.
  4. Record property-related expenses throughout the year.
  5. Reconcile rental income with your Wealth Statement before filing.
  6. File your return well before the due date instead of waiting until the last week.
  7. Respond promptly to every FBR notice with complete documentation.
  8. Review your return carefully before clicking the submit button.

Why Hire a Tax Lawyer or Tax Consultant?

  1. Own multiple rental properties.
  2. Receive both business and rental income.
  3. Have inherited property.
  4. Receive an FBR notice.
  5. Need to revise a filed return.
  6. Face an audit or tax litigation.

You can get an expert tax consultant Lahore or tax lawyer to assist you in ensuring compliance, in creating accurate documentation and to represent you in front of the Commissioner Inland Revenue or appellate authorities if necessary.

Our Tax Consultancy Services involve planning for rental income tax, filing returns, responding to notices, helping with the FBR audit, lodging tax appeals and compliance with FBR regarding individual and corporate taxpayers.

Why Choose Right Tax Advisor?

For over 20 years, Right Tax Advisor has offered concrete and legally sound tax advice.

Our services include:

Conclusion

It’s not just a requirement, it’s a crucial step towards ensuring tax compliance and safeguarding your financial interests to file an Income Tax Return for Rental Income in Pakistan. Proper rental income reporting, documentation, claiming tax credits and filing through the FBR IRIS Portal in time can help landlords to avoid penalties and future disputes.

When you have a single home or multiple commercial buildings, it’s more effective to be proactive than reactive when it comes to complying with tax notices. When you have a complex case or are unsure of your responsibilities, you may want to get professional advice to help ensure your return is prepared properly and according to the relevant tax laws.

Frequently Asked Questions (FAQs)

1. Is rental income taxable in Pakistan?

Yes. Rental income is subject to tax under the Income Tax Ordinance, 2001 and is taxable when it occurs and must be reported in the annual income tax return, if any.

2. How do I file rental income in FBR IRIS?

Log in to the IRIS Portal, fill out the Property Income schedule, claim tax credits and fill out the Wealth Statement, and submit your return.

3. What documents are required for a rental income tax return?

These are the documents that should be retained: CNIC, NTN, lease agreements, rent receipts, bank statements, property ownership documents, withholding tax certificates and Wealth Statement.

4. Can I claim deductions on rental income?

Under the Income Tax Ordinance, 2001 certain deductions may be obtained if they are legally allowed and have adequate documentation to support them.

5. What happens if I do not declare rental income?

If rental income is not reported, the FBR may issue a notice or assess further income, impose penalties, impose a default surcharge or conduct an audit.

6. Can I revise my rental income tax return?

Yes. Taxpayers have the opportunity to amend a return if there are any errors or omissions which were genuine.

7. Do I need an NTN to file a rental income tax return?

Yes. It is generally advisable, to be registered with the FBR and have an active NT before filing your return using IRIS.

8. Should I hire a tax lawyer or consultant?

For those who own several properties, or have complex tax situations, it’s helpful to have an experienced tax professional on your side to help you comply and avoid the potential for expensive mistakes in your tax situation.