19 Dec 6 Tax Deductions You Might Have Missed
The hardest thing to understand is taxes – a sentence uttered by every person since taxes were invented. We are sure that there are plenty of things about taxes that you as well don’t understand.
We always try to help you with that, which is why we made this text on some of the significant tax deductions people often overlook. Read up on them, to never miss out on any of them again.
1. Home Office Deductions
If you are a freelancer or merely work from home, you might be surprised to find out that there are deductions for that as well.
This deduction is usually calculated according to the exact percentage of the home that’s used to conduct business.
2. State Sale Taxes
If you live in an income-tax-state, you get to choose between deducting income or sales taxes on the local and state level.
The IRS has tables for people who have sales taxes which show how much they can deduct. However, if you purchase home building materials, a boat, airplane, or any land vehicle, you can add the state sales tax to the amount shown in this IRS table.
You can even use the IRS calculator to figure out what the deduction for you would be, as they vary depending on the state and your income level.
3. Child and Dependent Care Credit
It is a tax credit and not a tax deduction, but missing this one is a bigger deal because a tax credit reduces your tax by each dollar.
If you pay for your child care through specific accounts at work and your expenses are higher than $5,000, you can claim this credit.
4. Deductions for Low-Income Households
Many people fail to claim the so-called Earned Income Tax Credit because they don’t understand the complicated rules or don’t know that they can. However, it’s relatively simple; you’re most likely eligible if you’re from a low-income household with children. Even if you are part of a moderate income household, you still can get the deduction if you lost a job or got a pay cut.
You can always ask a tax resolution specialist to explain this to you if you’re not confident that you can receive such a deduction.
5. Tax Deductions on Job Searches
If you’re looking for a new job in the same line of work as your last job, you’re eligible for this deduction.
Even if you don’t get hired, this deduction allows you to write off the money you spent while attempting to get hired. The deduction includes expenses like transportation, food, printing costs, and accommodation.
6. Alimony Deductions
Almost all divorce expenses cannot be deducted, but the same doesn’t go for attorney fees for settling alimony payments or getting tax advice on them.
You need to ask your attorney for an itemized account of their fees if you want these deductions counted.
There are many other tax deductions that people often overlook that would have taken us a long time to cover. You can find out about them easily by contacting Golden Tax Relief, as we know all the often omitted things in the world of taxes, which can help you save a lot of money.