26 Most Overlooked Tax Deductions
If your employer asked you to return jury pay to the company because the company paid you while you served, you can deduct that jury pay from your taxes. If you keep it, it’s taxable income.
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Cleaning and laundering services when traveling are deductible as long as they aren’t reimbursed by your employer.
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Costs associated with looking for a new job in your present occupation, including fees for resume preparation and employment of outplacement agencies are deductible.
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If you belong to a labor union and you pay dues every year (typically withdrawn from your paycheck), deduct them.
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You can deduct education expenses (books, courses, etc.) to the extent that they required by law or your employer or if they are needed to maintain or improve your skills.
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If you are required to wear protective clothing at work (often the case for electricians, carpenters, chemical workers etc…), you can deduct that expense.
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As part of unreimbursed employee expenses, you can also deduct annual or less subscriptions to professional journals as well as trade or business tools, like software, as long as these expenses are appropriate and helpful in your business.
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Casualty losses, including damage, destruction or loss of property resulting from a sudden, unexpected or unusual event are deductible. You can find a list of losses that are deductible on the IRS website. There’s also a deduction for theft losses. The deduction for casualty and theft loss is limited so you’ll need to calculate it precisely.
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Commissions and closing costs on sale of property are deductible expenses. Think interest, certain mortgage points and deductible real estate taxes.
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When selling a home, you can also deduct any improvements you have done to your home since they add to the cost basis of your home and subtracted from the sale price, reducing any gain (and in turn taxes to pay on that gain.)
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Self-employed people have to pay a 100 percent of this tax, but they can deduct half of it. The same is true for Medicare taxes.
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If you’re self-employed, you can claim the business use of your phone as a tax deduction, but you’ll need to gauge the percentage of usage for business as opposed to personal use.
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If you’re self-employed, you may be able to deduct your medical and dental insurance for yourself, your spouse and any dependents under the age of 27 at the end of 2014.
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Although you can’t deduct the value of your time or services given to charity, certain out-of-pocket expenses you incur in giving those services, such as the cost of gas when volunteering, qualify as a tax deduction.
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You can deduct expenses related to the purchase of contact lenses, eyeglasses and hearing devices as long as they aren’t covered already by insurance or paid by pre-tax dollars through a flexible spending account.
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Contraceptives are also deductible as long as they’re bought with a prescription and not by using pre-tax dollars through a flexible spending account.
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You can deduct medical expenses that go toward qualified long-term care services and premiums paid for qualified long-term care insurance contracts
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Fees you pay to rent a safe-deposit box to hold your investments are deductible, although they don’t qualify if you use the box for jewelry or other personal effects.
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You can deduct fees for counsel and advice about investments that produce taxable income, including any amount you may have paid for investment advisory services.
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Stocks and bonds that you sold at a loss can be used to offset taxable gains as if they were sold; but if the stocks or bonds became worthless in 2014 before you sold them, you can write them off.
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Student-loan interest is deductible, regardless of whether the parents or the students paid them.
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The American Opportunity Credit can be claimed for the first four years of post-secondary education for expenses paid for tuition, certain fees and course materials, including books, supplies and equipment not paid by an institution. It is a tax credit of up to $2,500 per student if you make $80,000 or less. The credit is reduced if your modified adjusted gross income exceeds that amount and you simply cannot claim it if it is greater than $90,000. You can still benefit from the credit even if you don’t owe taxes. NOTE: You can’t combine the Lifetime Learning Credit with the American Opportunity Credit.
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Lifetime Learning Credit is for qualified tuition and related expenses for an indefinite number of years. The credit is up to $2,000 per return if you make $52,000 or less. The credit is reduced if your modified adjusted gross income exceeds that amount and you simply cannot claim it if it is greater than $64,000. (NOTE: You can’t combine the Lifetime Learning Credit with the American Opportunity Credit.)
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You can deduct accounting fees for tax preparation services for the year in which you pay them. (On your 2014 return, you’ll be able to deduct fees paid in 2014 to prepare your 2013 tax return). These fees include not only the cost of tax preparation, but also software you’ve used and tax publications.
Your gambling winnings are fully taxable as income, but you can also claim gambling losses to the extent of gambling winnings as an itemized deduction.
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State personal property taxes on cars and boats are also deductible.
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