Doing your taxes correctly is stressful; thus, a little planning can take you a long way. Most times, you need to pay more attention to common tax deductions, meaning you end up paying higher than required. If you’re unaware of standard tax deductions while tax preparation in Cape Coral, FL, we have you covered. This article highlights common tax deductions you may miss. Without any further delay, let’s explore!
7 Most Common Tax Deductions You Are Probably Missing
Here are some common tax deductions you are probably missing out:
1. Medical Cost
Medical expenses, which are more than a specific percentage of your AGI or adjusted gross income, are deducted. Some common ones include prescription drugs, doctors’ fees, dentists, and travel expenses to the hospital or healthcare center.
2. Home Office Deductions
In your home, if there is a dedicated space meant for office work, a certain percentage of the expenses related to that particular space will be reduced from the income tax.
3. Moving Expenses
Although moving expenses were abolished at the start of 2018, still a group of people who get tax deductions on moving expenses are military personnel. If you belong to an army group and are an active member, you can seek deductions on moving costs.
4. Educational Cost
Educational expenses like books, equipment, tuition fees, student loan, and others are generally tax deductible. You can claim a tax reduction if you are a student or a teacher.
5. State Income Tax Deductions
Not every state collects income taxes. In case your state collects taxes, ensure you keep track of sales tax on a car, boat, or plane. Ensure you regularly check new tax laws.
6. Charitable Expenses
In case you have made donations to any well-known or qualified charitable organization, the tax will be deducted. Ensure you keep records and donation receipts of these donations.
7. Mortgage Interest
If you pay interest on a mortgage, the interest paid is generally tax deductible. This is because the government prioritizes homeownership and excellent financial behavior.
Wrapping Up!
These are some of the common tax deductions that you may miss. As a result, you tend to pay higher than the actual tax. Besides these, there are several tax deductions that you can discuss with experts and lower your taxation cost.
