Did you know that you may be leaving hundreds or even thousands of dollars on the table when you file your taxes this year? From medical insurance premiums to magazines, there are quite a few little-known tax-deductions that could make Tax Day a much happier event for your family.
If you are one of the millions of people wondering, “what can I deduct on my taxes,” you are in the right place. Here you can learn about several little-known tax deductions and how they can help you save big.
1. Student Loan Interest
Are you one of the 43 million Americans who are stuck having to pay off your student loans? If so, there is some good news for you – you may be eligible to deduct as much as $2,500 in student loan interest. What’s even better is that you don’t have to itemize the deductions to take advantage of the allowance.
However, it isn’t always that simple. If you want to qualify for this student loan deduction, you have to be filing an individual tax return, even if you are married. Additionally, you can be claimed as a dependent on another person’s return. There are several income limits that are associated with the benefit, too. It may be wise to talk with an accountant to find out if you would be eligible for this deduction.
2. Long-Term Care Premiums and Medicare Insurance
You are allowed to claim a Schedule A itemized deduction for any unreimbursed medical expenses. This includes your health insurance premiums if they exceed 7.5 percent of your AGI (adjusted gross income). While this 7.5 percent of AGI can seem like an insurmountable hurdle, seniors are often about to clear it, especially if they remember to include the following:
3. The Costs Associated with Searching for a Job
Trying to find a new job, or any job, for that matter, can be expensive. The good news is, you can receive a tax break if you retained a record of all your expenses. You will be able to write off all of your transportation costs that are associated with your job search, which includes parking expenses, gas, train or air fares and lodging. If you used any type of resume service, you will also be allowed to deduct that.
There is a catch to this deduction. You will only be able to deduct the expenses that exceed two percent of your AGI. If you have an AGI of $25,000 and the amount you spend in eligible job search costs is $1,000, you will be able to write off $500. Additionally, you will only be able to take deductions for job search costs if you are searching for work in your established industry or field. You can’t write off costs associated with looking for your very first job either.
4. Gambling Losses
When asking the question of “what can I deduct on my taxes,” the last thing most people would think of is gambling losses. However, there are allowances for deductions related to gambling losses. For example, you can write your losses off if you have the winnings to deduct them from. For example, if you lose $1,000 during one day gambling, but won $3,000 before, you will be able to deduct the $1,000 and just have to pay taxes on the left over $2,000.
If you want to do this, you will need to keep a very detailed record of all your losses and winnings, including the dates you gambled and the type of gambling you participated in.
The savvier that you become about tax deductions, the more that you will be able to reduce your overall taxable income. Keep in mind, if you are still confused about how to make the most out of your tax deductions, you should consider working with an accountant. They will help ensure you receive all the deductions you are entitled to, including all the lesser-known ones you learned about here.
