Posted by Richard Holbrook, MBA

Personal Deductions That Save Money

Personal Deductions That Save Money

When it comes time to work on your taxes, there are a lot of things that you can do to make sure that you are going to save as much money as possible. You don’t want to finish out the tax return and find out that you owe a lot of money to the government, and finding out which deductions are the best for your needs and meet your situation can help you to save this money. While you should lie on the tax return and try to claim deductions that don’t apply to you, there is nothing wrong with trying to get all of the benefits from these credits and deductions as possible.

If you aren’t sure about which deductions are going to work the best for you or if you’re allowed to use a particular deduction for the year, it is a good idea to talk to your local tax professional. They know how the tax laws work and will be able to go through all of your information to figure this out with you and save as much money as possible. Contact them today to get your taxes started today.

Child Deduction

Having children can be expensive. But the IRS has provided a few deductions for those families with children. If you are able to claim as head of household, you will be able to get a deduction automatically for any children you can claim. This can come out to a maximum of $1000 per child and can really help lower your tax bill and make it easier to have more to spend on the children. Make sure to talk to your tax professional to ensure that you are the head of household and able to claim any children.

In addition, if you need to send your children to daycare because you are working or looking for work, you can deduct some of the daycare expenses that you are dealing with. You are going to need to take care to keep all of your receipts on hand to show how much you spent on the daycare expenses, but this can help to offset some of the costs that you incur for having someone watch your child while you are at work. It doesn’t matter what kind of daycare provider you choose, as long as you have all the right papers in place.

Medical Expense Deduction

There are some cases when you will be able to deduct some of your medical expenses when it comes to tax time. First, there are a number of supplies that you will be able to get and deduct during your tax season. Remember that you are only able to get this deduction if no one else is paying for the item, such as your insurance. Breast pumps and hearing aid supplies are two of the most common items deducted under this, but you can check with your tax professional to make sure you aren’t missing out on other deductions.

Sometimes, those medical bills can get expensive. If you ended up spending more than 10 percent of your income on your medical bills during the year, you may qualify for a deduction for the amount over the 10 percent that you spent. While you aren’t able to take all of your payments for the deduction, it can certainly help out when you get your taxes done.

Student Loan Deductions

Paying off your student loans is a great way to help out with your finances. Not only are you reducing the amount that you owe to the government or a private student loan provider, you are able to get some of the money back when you do your taxes. If you made any payments on your student loans during the year, regardless of whether you are doing so while in school or afterwards, you could qualify for a deduction on your tax return. There are maximum amounts and you are only able to claim on your interest paid, but it could be a nice way to reduce the amount that you owe during tax season.

Home Office Deductions

It is becoming more and more common for people to work from home. It is more convenient to work from home, taking care of all your business needs as well as the family without having to commute to work or work on the time that is set by your boss. But working from home means that you are going to be the one in charge of your own supplies and other items needed for your office rather than relying on an employer to do the work for you.

If you are working from your home, consider using the home office deduction. This will allow you to save some money on any office supplies that you would need to keep the business running as well as the mortgage interest, some phone and internet bill, and more. Make sure to talk to your tax professional to see what you are able to deduct with your home office.

There are many deductions that you get to use when it comes to working on your tax returns, but figuring out which one is going to work out well for your situation is a challenge. When you are ready to get started on that tax return and want to ensure that you get everything in order, contact your tax professional right away.

Richard Holbrook, MBA
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