The Most Overlooked Tax Deductions
In the United States, everyone is required to file taxes on a yearly basis. Nobody likes paying taxes, but many individuals may be eligible for tax deductions. For example, many students with loans, seniors on a fixed income, military personnel, and working parents who pay for child care can take advantage of income tax deductions.
Below are a few of the most commonly overlooked tax deductions you might be eligible for:
1. Student loan interest
American-based students who have taken out a student loan are eligible to deduct any interest they pay on that loan from their taxable income. This student loan interest deduction can amount to quite a bit of money, so be sure to take advantage of it if you qualify.
2. Moving expenses
There are many situations in which you may be required to move for your job, resulting in moving expenses. This includes the cost of renting a vehicle to transport items, traveling to your new location, or even paying storage costs. This tax deduction is especially pertinent for military personnel who move frequently for reassignments. Just keep all of your receipts and documentation in order to file this deduction when tax time arrives.
3. Disability tax credit
This is a tax credit available to those who have qualified as disabled and have incurred expenses as a direct result of their disability. These write offs can include costs for medical treatments, special equipment, or even transportation. If you think you may be eligible for this tax deduction, make sure to speak with an income tax specialist.
4. Child and dependent care tax credit
This is a tax credit available to parents, caregivers, or guardians who incur payments to care for their children or dependents. This tax credit may cover deductions for both children, child dependents, and adults who are physically or mentally unable to care for themselves. The amount of the tax credit depends on how much you spend on care each year, as well as your income level. As with most tax deductions, it’s best to seek income tax professional services to find out if you qualify.
5. Medical expenses
Many Americans don’t take advantage of writing off their medical expenses because they don’t think it’s worth the effort. However, if you spent money on glasses, contacts, prescription medication, medical equipment such as crutches or a wheelchair, or even fertility treatments, then chances are you may qualify for medical tax deductions. Even if you have already filed and missed this deduction, you may be able to file an amended return. Just make sure to keep all of your medical receipts.
6. Charitable and political donations
This can be a complicated deduction, and you’ll need to review your records first. However, if you donated even as little as $20 USD worth of food or clothing to charity last year, your donation may qualify as a tax deduction. This also extends to political support given to a candidate or party, which can be deducted from your taxes provided that it meets the required criteria.
These are just a few of the many commonly overlooked tax deductions that you may be eligible for. If you’re not sure whether you’re taking advantage of all the deductions you’re entitled to, it’s best to consult with an income tax specialist. Ask friends or family to recommend a tax consultant, or simply search online for “tax consultants near me.”