Every year the federal government gets to keep millions of dollars of the taxpayers hard-earned money because people do not know all of the deductions and credits that are available to them. Keeping in mind that there are over 70,000 pages of tax code, its very difficult for a person who does not have a Pre-Paid Legal tax attorney to ask questions to or a CPA to figure out what can be claimed and what credits are available.
I have done some research on some of the most common over-looked tax credits and deductions. Below you will find a list of the most common ones. Keep in mind that I am not a CPA or a tax attorney. For any questions you have, you need to contact your Pre-Paid Legal tax attorney.
* State sales tax: With this deduction a taxpayer can choose to deduct either their state sales tax or their state income tax. For most people, deducting their state income tax is a better option. However, if you live in a state that does not charge a state income tax, then the state sales tax is a better deduction for you. Still, you should speak to your Pre-Paid Legal tax attorney to find out which option is best for you.
* Educator's Expenses: Every year through 2011, if you are a teacher or educator you are allowed to deduct $250 for items that you have spent for your class. Having been a teacher myself, I know that this adds up quite fast! Keep a copy of all of your receipts. You do not need to file long form to claim this deduction. This can be done on the 1040, line 23. If you and your spouse are both educators, then you are both eligible for the $250 deduction.
* Student Loan Interest: Parents can now deduct the interest from their child's student loans. You can deduct up to $2500 per year.
* Out of Pocket Charitable Expense: Many people give contributions to their church or favorite charity every year. These are deductible expenses that can really help how much you have to pay in income taxes. Keep a record of how much you are giving. You should laso receive a financial statement from the organization. Keep this along with your cancelled checks. In the event of an audit, you will need these.
* Refinancing Points: If you have refinanced your home, keep a record of that. Because you are able to deduct the points.
* Job Hunting Costs:Many people have found themselves out of work in this current economy. There are many items you can deduct in your job search. These include costs of cab fares, food, lodging, transportation, employment agency fees, printing resumes, business cards, postage and advertising. Again, keep a record of all of these expenses and seek the advice of a Pre-Paid Legal tax attorney.
* State Taxes Paid Last Spring: You are allowed to deduct the amount of state income taxes you paid last year.
* There are also a variety of tax credits available. A credit is much better than a deduction because it gives you dollar for dollar reductions on your tax bill. Some out might want to look into are the child care credit and the energy tax credit. Again, consult your Pre-Paid Legal tax attorney for any questions you have regarding your eligibility.
These are just some of the more common deductions and credits available to taxpayers. Its very important to keep good tax records. If you are ever audited the government will want proof of everything. You need to speak to your Pre-Paid Legal tax attorney for any questions you should have and whether or not you should file long or short form. You have worked hard for your money. Do not let the money go unclaimed!
I have done some research on some of the most common over-looked tax credits and deductions. Below you will find a list of the most common ones. Keep in mind that I am not a CPA or a tax attorney. For any questions you have, you need to contact your Pre-Paid Legal tax attorney.
* State sales tax: With this deduction a taxpayer can choose to deduct either their state sales tax or their state income tax. For most people, deducting their state income tax is a better option. However, if you live in a state that does not charge a state income tax, then the state sales tax is a better deduction for you. Still, you should speak to your Pre-Paid Legal tax attorney to find out which option is best for you.
* Educator's Expenses: Every year through 2011, if you are a teacher or educator you are allowed to deduct $250 for items that you have spent for your class. Having been a teacher myself, I know that this adds up quite fast! Keep a copy of all of your receipts. You do not need to file long form to claim this deduction. This can be done on the 1040, line 23. If you and your spouse are both educators, then you are both eligible for the $250 deduction.
* Student Loan Interest: Parents can now deduct the interest from their child's student loans. You can deduct up to $2500 per year.
* Out of Pocket Charitable Expense: Many people give contributions to their church or favorite charity every year. These are deductible expenses that can really help how much you have to pay in income taxes. Keep a record of how much you are giving. You should laso receive a financial statement from the organization. Keep this along with your cancelled checks. In the event of an audit, you will need these.
* Refinancing Points: If you have refinanced your home, keep a record of that. Because you are able to deduct the points.
* Job Hunting Costs:Many people have found themselves out of work in this current economy. There are many items you can deduct in your job search. These include costs of cab fares, food, lodging, transportation, employment agency fees, printing resumes, business cards, postage and advertising. Again, keep a record of all of these expenses and seek the advice of a Pre-Paid Legal tax attorney.
* State Taxes Paid Last Spring: You are allowed to deduct the amount of state income taxes you paid last year.
* There are also a variety of tax credits available. A credit is much better than a deduction because it gives you dollar for dollar reductions on your tax bill. Some out might want to look into are the child care credit and the energy tax credit. Again, consult your Pre-Paid Legal tax attorney for any questions you have regarding your eligibility.
These are just some of the more common deductions and credits available to taxpayers. Its very important to keep good tax records. If you are ever audited the government will want proof of everything. You need to speak to your Pre-Paid Legal tax attorney for any questions you should have and whether or not you should file long or short form. You have worked hard for your money. Do not let the money go unclaimed!
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