There are many tax deductions available to the general public. However, most people do not use a majority of these deductions, let alone realize many of them exist! A few of the most commonly overlooked deductions include:
Travel for volunteering Most people know that they can deduct the value of the money or items they donate to charity from their taxes. However, few people realize that they can also deduct the cost of the mileage or travel when they volunteer. For example, if you volunteer transporting animals for an animal rescue group, you can deduct the amount it costs you to drive the animals around. Or, say you volunteer twice a week at a hospital that is a 10 mile round trip from your house. That is 1,040 extra miles of driving every year, just for volunteering. If you use the government's standard rate of 14 cents per mile, you could potentially deduct $145.60 from your taxes, just for driving to the hospital.
State sales tax The IRS allows you to deduct either the amount you pay in state income tax or state sales tax from your taxes. Most people decide to deduct their state income tax, as this is generally a higher amount. However, if you live in a state that does not collect state income tax (such as Florida, Washington, Connecticut, or several others), it would be very advantageous for you to deduct the amount of your yearly state sales tax. The IRS publishes guidelines about the acceptable amounts per state to claim for sales tax.
Student loan interest Any interest you pay on your student loans can be deducted from your taxes. Many college graduates will be happy to hear this news. Additionally, even if your parents help you pay off your student loans, you can still claim this on your taxes even if it is automatically deducted from one of their accounts through online banks. If your parents help you pay your loans, it is considered a gift to you, so you are eligible to claim it as yours.
Saving money These great tips will surely save you tons of money on your taxes. To save even more money, do some snooping around the IRS tax guidebooks to see if there are any other unknown tax deductions available to you.
Travel for volunteering Most people know that they can deduct the value of the money or items they donate to charity from their taxes. However, few people realize that they can also deduct the cost of the mileage or travel when they volunteer. For example, if you volunteer transporting animals for an animal rescue group, you can deduct the amount it costs you to drive the animals around. Or, say you volunteer twice a week at a hospital that is a 10 mile round trip from your house. That is 1,040 extra miles of driving every year, just for volunteering. If you use the government's standard rate of 14 cents per mile, you could potentially deduct $145.60 from your taxes, just for driving to the hospital.
State sales tax The IRS allows you to deduct either the amount you pay in state income tax or state sales tax from your taxes. Most people decide to deduct their state income tax, as this is generally a higher amount. However, if you live in a state that does not collect state income tax (such as Florida, Washington, Connecticut, or several others), it would be very advantageous for you to deduct the amount of your yearly state sales tax. The IRS publishes guidelines about the acceptable amounts per state to claim for sales tax.
Student loan interest Any interest you pay on your student loans can be deducted from your taxes. Many college graduates will be happy to hear this news. Additionally, even if your parents help you pay off your student loans, you can still claim this on your taxes even if it is automatically deducted from one of their accounts through online banks. If your parents help you pay your loans, it is considered a gift to you, so you are eligible to claim it as yours.
Saving money These great tips will surely save you tons of money on your taxes. To save even more money, do some snooping around the IRS tax guidebooks to see if there are any other unknown tax deductions available to you.
2 comments:
After reading your blog I think you have good information about tax. I would like to share this information with my friends who need this. Thanks for this blog. Business Tax Software in Canada
The article was up to the point and described the information very effectively. Thanks to blog author for sharing an informative post. File Taxes Online
Post a Comment