How to legally reduce your tax bill – 25 often overlooked tax deductions
Are you paying more tax than necessary? Are you aware of several legal tax deductions which are commonly overlooked by many people? Read these tips from author Jesse Slome. Please note down those tips which would directly apply to your scenario. If you make a purchase or spend money on any of the items mentioned in this article, make sure to save the receipt for using when you file your taxes.
Finally, all these tips are of very general in nature. To find the suitablity of these tips in your personal tax scenario, please consult your tax advisor.
25 Easily Overlooked Tax Deductions – A Simple List You Can Refer to When Preparing Your Tax Filing
If you are one of the millions of Americans who throws all their receipts, credit card and bank statements into a box, you are likely to overlook hundreds of dollars in tax deductions when preparing your tax filings.
May I suggest that you print out these often overlooked tax deductions onto a single piece of paper for easy reference as you start the annual process of looking for every possible tax-savings opportunity?
Here are 25 deductible expenses you don’t want to overlook.
1. Medical transportation expenses including tolls, parking, and mileage for trips to doctor’s, health facilities, laboratories.
2. Prescribed medical aids such as crutches, canes, and orthopedic shoes
3. Hearing aids, eye glasses, and contact lenses
4. The cost of alcohol and drug abuse programs, and certain smoking-cessation treatments
5. Education expenses you paid to maintain or improve job skills (including professional books)
6. Professional journals, magazines, and newspapers that are job-related
7. Cost of safe deposit box used for to store investments or investment information
8. Required uniforms and work clothes not suitable for street wear
9. Union dues.
10. Job-seeking expenses within your present field of employment – from printing resumes to phone charges.
Dues to professional organizations and business gifts up to $25 per customer or client
12. Cellular phones required for business
13. If you are self-employed, half of the self-employment tax paid
14. Self-employed health insurance premiums and long-term care insurance premiums up to the annual limits.
15. Fees for tax preparation or advice, including software like TurboTax if you meet limits
16. Services of a housekeeper, maid, or cook needed to run your home for the benefit of a qualifying dependent while you work
17. Penalties paid on early withdrawal of savings
18. State income taxes owed from a prior year and paid in the tax year-with your last return
19. Mileage incurred in performing charitable activities
20. Gambling losses to the extent of your gambling winnings – but be prepared to document this
21. The cost of employment agency fees or commissions in certain cases
22. Home office expenses, if your home is your primary place of business
23. Cash and non-cash contributions to qualified charities
24. Reservist and National Guard overnight travel expenses
25. Worthless stock or securities – but you must follow the prescribed rules.
If you are not familiar with the rules that make long-term care insurance potentially tax deductible for individuals and business owners, visit the Consumer Information Center of the American Association for Long-Term Care Insurance and click on the box marked Tax Deductibility. You’ll find the rules as well as the 2008 and new 2009 tax limits.
Jesse Slome is Executive Director of the American Association for Long-Term Care Insurance. The industry trade organization does not sell insurance products but maintains an excellent website for consumers seeking additional information on the subject. If you would like to receive a no-obligation free quote from a member of the Association, visit our Consumer Information Center.
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