Who doesn't want to save a little (or a lot of) extra money at tax time? Claiming all the deductions for which you are eligible can significantly reduce your tax bill. The problem is, it's hard to take those deductions if you don't know about them. Check out these five you may have missed.
If you pay a significant amount of money on health care costs, look into deducting some of that amount. Qualifying unreimbursed medical expenses that exceed 10 percent of your adjusted gross income can be deducted. This even includes the amount you spend for your health insurance premium. If you or your spouse are 65 or older, the 10 percent threshold is lowered to 7.5 percent of your adjusted gross income. Furthermore, if you are self-employed, you may be able to deduct the entire cost of your health insurance premiums.
The costs of moving can really add up. If you have relocated at least 50 miles away for work, you may be able to deduct your moving expenses. This can include the cost of moving and storing goods, plus your travel expenses. However, you aren't eligible to deduct any amount for which your employer reimbursed you. Form 3093 from the IRS can be used to calculate the amount you can deduct.
Natural disasters can wreak havoc on your life. Fortunately, the IRS will help you out a bit, thanks to the casualty loss deduction. You may be able to deduct part of your loss caused by damage or destruction to your property from a natural disaster, such as a flood or hurricane. Any money that was reimbursed to you by your insurance company is excluded from this deduction. To figure your deduction amount, use Form 4684 from the IRS. Plus, if you live in a federally-declared disaster area, the IRS may extend various tax-related deadlines for you.
Giving away what you don't need not only makes you feel good, but it also has financial benefits for you. Most people are aware that cash gifts to a charity are tax deductible, but so is the value of tangible donations, such as used clothes that you take to the Salvation Army. The items must be in good shape, and you should request a written receipt from the charity. Additionally, there's another good citizen deduction you can take, and that's the transportation costs you incur while traveling to serve as a charity volunteer.
Educators often stock their classrooms with supplies purchased out of their own pockets. Fortunately, they're eligible for a deduction of up to $250 that can help them recoup some of those costs. This deduction is available to qualifying teachers, principals, aides, counselors and other select employees in kindergarten through grade 12 schools. This is an above-the-line deduction, also known as an adjustment to income, which means that you can claim it even if you don't itemize deductions. And if you and your spouse are both teachers, each of you are eligible to claim up to $250 in expenses.
If you need assistance determining which deductions you qualify for, consult a tax professional. Sure, hiring a specialist will cost you a few bucks, but it will be well worth it if the pros can save you some serious green.
Every dollar adds up, and claiming every deduction you can may save you hundreds at tax time. So start combing those receipts to see where you can save through deductions this year!
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Meghan Ross is a freelance writer covering all things home and living. Her work can be found on Examiner.com.
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