10 Overlooked Tax Breaks
October 19, 2012 6:04 PM
With October 15 behind us and April 15 still comfortably far away, it’s a good time to start boning up on ways to save your clients money once things start getting serious.
With that in mind,Bankrate.com identified 10 great deductions that individual taxpayers should use – but often forget.
With that in mind,
1. Charitable expenses
Sure, the donation is deductible, but so are expenses incurred while doing charitable work – including possibly cleaning your candy-striper’s outfit, or your mileage on your car for taking all those (insert life-saving materials here) to those (insert needy recipient here).
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2. Moving expenses
Not only can you deduct many moving expenses when you relocate – you can even deduct your very first relocation – say, after college.
3. Job hunting costs
Costs associated with looking for a new job while in a current job are deductible, as long as the taxpayer itemizes – and the costs, along with other miscellaneous itemized expenses, exceed 2 percent of the taxpayer’s adjusted gross income.
4. Military reservists’ travel credits
Reservists and members of the National Guard who travel more than 100 miles in a day and stay overnight for training can deduct related expenses.
5. Child and other care credits
Child care costs for looking after the rugrats during the summer can be deductible, too – but only for day-camp, not sleep-away camp. Care expenses for adult dependents may also be deductible.
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6. Mortgage refinancing points
If a taxpayer used the proceeds of a mortgage refinancing to improve their principal residence, they may be able to deduct the points paid on the load for the year of purchase.
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7. Many medical costs
Various miscellaneous medical costs – like travel expenses to and from treatments – may help taxpayers reach the 7.5 percent of AGI threshold for claiming medical expenses.
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8. Retirement savings
The Retirement Savings Contribution Credit aims to get moderate- and low-income taxpayers to save, and can be worth as much as $1,000 on contributions to an eligible retirement account.
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9. Educational expenses
There’s tons here, including deductions for tuition and fees, the Lifetime Learning Credit, and the American Opportunity Tax Credit. If the taxpayer is getting any kind of education, they’re worth looking into.
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10. Energy-efficient home improvements
While not quite as generous as before, there are still credits worth up to $500 for energy-efficient home improvements available for 2011 returns.