Tax deductions are a wonderful thing! They save you money during tax season, so who wouldn’t want that? Here are 10 of the most overlooked tax deductions. Use these to save that money!
Charitable Contributions
When itemizing deductions, it is important to include charitable contributions in those deductions. Charitable contributions can include donating money, donating items such as clothes or furniture, or any out-of-pocket expense you had while traveling to volunteer. Just make sure you keep all your receipts for these contributions, otherwise you won’t be able to itemize them.
Student Loan Interest Deduction
Some people have student loans, which are not the best debt to have. However, did you know that you can save money on your taxes if you pay into your student loan interest? There is a deduction for student loan interest that can be used during tax season. Have that student debt do something good for you!
Tax Credit for Retirement Savings Contributions
If you have a 401(k) or an IRA, you might be able to get a tax credit on it! It is called the Saver’s Credit, which is designed to get people with lower incomes to save for retirement. With this saving, you can get money back on your taxes. It is important to know that the Saver’s Credit is designed for people with lower incomes, so not everyone will be eligible to participate in this deduction.
Losses From Gambling
Gambling wins are taxable, but did you know you can write off gambling losses? If you played the lottery, gambled at a casino, or bet on sports games, you could deduct any losses from your taxes. It is important to note that gambling losses can only be deducted if they are itemized. And don’t try to deduct losses that exceed winnings, because that won’t work as a deduction.
Other Dependent Tax Credit
It is a no-brainer to receive tax credits for your dependents. You will definitely be able to have kids under 17 as dependents, but you might be able to file older kids and adults as dependents too. You can get $500 for each dependent that qualifies. You cannot file someone for a child tax credit AND an other dependent credit, so make sure you talk to a tax advisor when you go for this credit.
Jury Pay Tax Deduction
You can deduct any jury pay that you don’t get to keep. Sometimes employers require those who serve on jury duty to give them their jury pay because they are also getting a salary while on the jury. However if you keep your jury pay, that is actually taxable and not eligible for a deduction.
Credit for Child and Dependent Care
A good deal of people don’t know about the credit for child and dependent care, and they are missing out! If you pay for your child to go to daycare, go to summer camp, or if you pay a babysitter, these all follow under the child and dependent care credit. There are some different roles for using babysitters for this credit, so make sure you read up on those before filing.
The State and Local Tax Deduction
The State and Local Tax deduction is also known as the SALT deduction. You can itemize and then deduct up to $10,000 of these taxes: property, sales, or income taxes already paid to state and local governments.
Read More: How Do IRS Tax Relief Programs Work?
Mortgage Point Deduction
What exactly are mortgage points? Mortgage points are also known as loan discounts or discount points which are a form of prepaid interest. Mortgage points are tax deductible if itemized. You will get a form that will explain how many mortgage points you paid if you paid over $600 of mortgage interest in that year.
Read More: 10 Things to Know Before You Refinance Your Mortgage
Armed Forces Moving Expenses That Are Tax Deductible
If you are in the Armed Forces, your moving expenses could be tax deductible. The expenses are tax deductible if you have to move due to a military order or you need to make a permanent change of station.
Read More: Simple Advice: How to Deal With Tax Debt
