The Top 10 Overlooked Tax Deductions

The top 10 overlooked deductions Each year, thousands pay too much in taxes because they didn’t think of deducting job hunting expenses or donations to charity. Read this list before you file.

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Did you pay too much to Uncle Sam last year?

 Tax laws change ever year and staying current with those Federal, State, and Local tax laws are an integral part to ensure you are not overpaying your taxes. So how can you be assured that you are not overpaying taxes? If you are preparing your own tax returns using a tax software package, please keep in mind that software alone is not a substitute for understanding tax law. You should be spending many hours annually to stay current with all the tax law changes. If you are using a tax preparation service, make sure you fully understand the tax background and experience level of your preparer. Here are some good examples of questions to ask your preparer: Read more

Qualified Medical Expenses

Following is a list of qualified medical expenses that you can report on Form 1040 as a deduction. We don’t claim to include every conceivable deductible medical expense, but it’s a pretty hefty start! The expenses are listed in alphabetical order. For a complete list of qualified medical expenses, see IRS Publication 502, Medical and Dental Expenses. Read more

How do home improvements affect your taxes?

One of the questions that tax preparers hear all the time is: “I added a sun room (added a deck, replaced the roof, caulked the bathtub—you fill in the blank). Can I take it off my taxes?” The short answer? “No.” Read more

ATM… What is it?

What interest payments can I deduct? (2011)

Whether or not you can deduct interest payments on a loan depends on what the loan is for and sometimes how the loan is secured. Here’s a list of what is deductible and where you take the deduction:

You can deduct:	Report the deduction on this form or schedule:
1. Interest on debts taken out for business operations	Schedule C
2. Interest on student loans (special rules and limits apply)	Form 1040 (worksheet is provided in the instructions)
3. Margin interest (up to the amount of interest, dividend and other investment income you have)	Form 4952
4. Home mortgage interest on your primary residence	Schedule A
5. Home mortgage interest on your secondary residence or vacation home	Schedule A
6. Home equity loan interest (to the extent that the loan doesn’t exceed $100,000)	Schedule A
7. Interest on loans you take out to buy property to hold as an investment (such as land, securities, etc.)	Form 4952
8. Points paid when you buy a house	Schedule A
9. Points paid when you refinance your home loan (deducted ratably over the life of the loan)	Schedule A
10. Interest you pay on loans to purchase property that you rent to others	Schedule E
11. Interest on debts taken out for farming operations	Schedule F or Form 4835
12. Redeemable ground rent (lease payments made for the use of land) if the lease term is for more than 15 years and you meet certain other criteria	Schedule A
13. Construction loan interest where you use the proceeds to buy a building lot (provided you meet certain requirements)	Schedule A
14. Timeshare loan interest in which you own the property (fee simple or deeded) as a vacation home	Schedule A
15. Boat loan interest if the boat has basic living accommodations and serves as a vacation home	Schedule A
16. Mobile home loan interest if it serves as a vacation home	Schedule A

You can’t deduct the following types of interest: Credit card finance charges and interest (except on purchases made either for your business or for property you rent out) Car loan interest (unless your car is used in your own business) Interest on loans for personal purchases Interest on loans for purchasing tax-exempt securities Interest on a loan for making a down payment on a house, unless the loan is secured by the home itself Interest assessed on unpaid tax liabilities

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