Tax season may be a couple months away still, however, it’s never a bad idea to get a head start. This year, if you are doing your own taxes, make sure you aren’t missing out on any potential tax deductions. Some of these are fairly common knowledge, however some of them may not be as well-known. Take a look at this list to see what you may be forgetting about, and check out our tax preparation and planning services if you decide you would like some additional assistance.
Sales Tax
When filing your federal income taxes, keep in mind that if you are itemizing, you may have the option to deduct sales taxes on large purchases or your state income taxes. Itemizing may seem like additional effort, but in the long run, it could potentially put more money back in your pocket.
Health Insurance
Most people are aware of the fact that your health insurance costs can be a tax break each year. However, deductible medical expenses that exceed 7.5% of your income can sometimes be claimed as a deduction on your itemized taxes as well. If you are self-employed and supply your own health insurance, you might have the option of deducting your entire cost from your adjusted gross income.
Teaching Materials
If you are a teacher, you may be familiar with spending your own money on supplies for your classroom and curriculum. With this in mind, you may be able to deduct up to $250 from your AGI, whether you itemize your tax return or not.
Charitable Giving
The majority of people realize that donations of money or goods given to charity or similar organizations can be deducted. What many people do not realize, however, is that out-of-pocket costs for any charitable contribution may also be deductible.
Childcare Costs
While the cost of a babysitter for date night might not be a reasonable deduction, if you are paying for childcare while you are at working or looking for work, you may be able to deduct this. Be sure to note all of the identification information necessary for your childcare provider in order to have this deducted from your income, whether you have chosen to itemize or not.
Continuing Education
Making payments towards student loans typically grants a deduction on your taxes, however, another grant called the Lifetime Learning credit may also provide some assistance for your taxes if you have chosen to further your education after high school.
Unemployment
In some circumstances, the costs of being unemployed and searching for work may be considered a deduction on your taxes. Mileage, gas costs, ink for printing out your resume, all of these may fall into this category should you be eligible for this deduction.
While you may not be eligible for all of these tax deductions, finding the ones that you can take advantage of can help to reduce how much you may owe or increase how much you receive in your refund. If you want to learn more about how to check your eligibility for these deductions, or want assistance planning for and filing your taxes, contact our team of experts today.