Some citizens spend the whole year preparing for tax season, while others put off their financial matters until the last possible moment. These people are rewarded and punished respectively for their prudence and procrastination. Tax season doesn’t have to be a dreadful time of year. In fact, there are several common tax deductions that you may be overlooking in your annual filings. Be sure to prepare for an earlier and more rewarding filing by taking advantage of these frequently missed deductions.
- Charitable Donations
Most people know that cash donations to charitable organizations can be deducted on their tax returns, but what about non-cash donations? Most people miss out on this deduction because they are uncertain about attaching cash values to the things they donate. However, if you’re carting loads of charity to local Good Will or Salvation Army centers, you can deduct these things when tax season comes around. Obtain receipts for your donations whenever possible so that you can defend your claims in the event of an audit.
- Student Loan Interest
College students and graduates are in a tough situation today. The job market is inhospitable and student loan debt is higher than ever. The IRS understands this struggle, and they’re willing to cut diligent students and graduates a tax break. Payments made on student loan interest can be claimed as deductions on income tax every year. If you’re still making student loan payments, be sure to consider this in your annual tax returns to get the refund you deserve.
- Expenses for Educators
Teachers have some of the most important jobs in the world today. Preparing students both young and old for their next steps in life is a noble and admirable occupation, but it can often be expensive. Many educators spend significant amounts of their own money in collecting classroom materials and developing lesson plans. If you are an educator, make sure that you obtain receipts for all of your classroom expenses. The IRS offers a tax break to educators who spend money out of pocket for the benefit of their students.
- Home Office Expenses
Working from a home office grants ambitious professionals a degree of freedom that many people never experience in their entire careers. However, there are many significant expenses to account for in a home office. Many workers don’t realize how much an employer provides until they are forced to furnish their own offices. Luckily, many of those expenses are tax deductible. Office supplies and equipment can be written off, and rent and utilities may be partially deductible as well. Income tax forms aren’t designed to tell you about these options, so be sure to read up on deductions or talk to a professional accountant.
Home Improvement Projects
Have you spent large amounts of money renovating your home this year? If so, you may be eligible for significant deductions on your taxes, especially if your home improvements have been in the name of energy efficiency. The energy crisis is a real problem, and the government is prepared to reward those who are proactive in reducing their consumption and emissions. Keep receipts from any energy efficient home upgrades to get a break on your taxes.