While dealing with taxes may not be fun, there are always some great ways to save each year. So check out these tax deductibles you might not know about!
Even if your parents are helping you pay back your student loans, you are eligible to take a deduction. The IRS considers this a gift which they gave you, and gifts mean you’re not supposed to be taxed on them. So if you are a student who has not claimed as a dependent, you can qualify to deduct up to $2500. This is a huge saving for you!
Savings for Teachers
Our K-12 qualified teachers deserve all the love and respect that they can get, and the IRS is a believer in this too! Many times the teachers take money out of their own pockets and spend on decorations and supplies for their classrooms. So K-12 educators are allowed to deduct up to $250 for materials.
If you are serving your country and you have moved more than 100 miles for a meeting or a drill, and stayed overnight, then you are also eligible for some deductions. So you can save on mileage, 50% of your food costs and lodging this year!
You won’t be able to recover the cost of finding a new job, but if you move to take a new job, that’s recoverable! If you have moved more than 50 miles, you can deduct 23 cents per mile of the cost of getting yourself and your belongings to the new location (even the toll tax and parking fees)!
This one is honestly a little tough and complicated and only a certain percentage of health care expenses can be recovered. However, Micah Fraim, an independent CPA (Certified Public Accountant) from Virginia, says, “Good alternatives, when they are available, are Flexible Spending Accounts (FSAs) and Health Savings Accounts (HSAs). These accounts allow you to spend money for medical purposes with pre-tax dollars.”
As surprising as it may seem, the federal court has now ruled that you can list the cost of a babysitter as a charitable contribution on your return. But there is a condition for this; the only way you’ll be able to deduct this cost is if while the babysitter is performing their duties, you are volunteering.
Awareness is everything, so find out about all the money you owe in taxes and where you can possibly save. The saved money can be put towards financial goals and savings.