Drake Software blog for tax pros, covering tax, IRS news, and more

The Forgotten Tax Deductions

The Forgotten Tax Deductions

The Forgotten Tax Deductions

Would you like to be a hero to your taxpayers?  Offer a few tips to them about deductions they may not know about.  Include a list of possible deductions in a pre-season email reminder or include them in a list of hot topics on your website – this will help them prepare for their office visit and help them build their trust in you.  Here are a few examples of those things taxpayers often miss…

  • Volunteer Work.  Expenses incurred while doing charitable work, such as mileage, meals, and uniform cleaning fees may be deductible.
  • Job Hunting.  Taxpayer who itemize and incur costs while job hunting that exceed two percent of the taxpayer’s adjusted gross income can deduct those expenses.
  • Military Reservists’ Travel Credits.  Reservists and members of the National Guard who travel more than 100 miles and stay overnight for training can deduct related expenses.
  • Child and Other Care Credits.  Summer child care costs for day-camps can be deductible.  However, you cannot deduct expenses for sleep-away camps.  Care expenses for adult dependents may also be deductible.
  • Mortgage Refinancing.  If a homeowner refinances and uses proceeds to improve their principal residence, they may be able to deduct the points paid on the loan for the year of purchase.
  • Medical Expenses.  Travel expenses to and from treatments, including mileage and meals, may be deducted if the taxpayer’s medical expenses reach the 7.5 percent of adjusted gross income threshold.
  • Retirement Savings. Moderate and low-income taxpayers may be able to save as much as $1,000 on contributions to an eligible retirement account.
  • Educational Expenses. There are many education expenses that can be deducted – tuition and fees, the Lifetime Learning Credit, and the Opportunity Tax Credit.  If a taxpayer is pursuing any kind of education, it’s worth looking into.
  • Energy-Efficient Home Improvements.  There are still credits worth up to $500 for energy-efficient home improvements available for 2011 returns.

Taxpayers welcome any advice that may help them save money.  These simple tips may make a big difference in their bottom line.


admin taxing_subjects

The Taxing Subjects staff is proud to cover the latest in tax-industry-related news, from tax law and IRS updates to technology and business strategies. If you have questions about an article or just want to reach out to the Taxing Subjects staff, email comments@taxingsubjects.com.

comments powered by Disqus