Tax Deductions You Can't Afford to Miss
January 04, 2019, 8:54 AM
Whether you're going to owe big this year or get something back, it's still a chore to go through the motions and get everything submitted by that April deadline.
But, have you considered whether you are taking advantage of the right deductions? Before you submit your return, here are some of the most overlooked tax deductions that you may want to include this year.
A Second Home.
Use Schedule A to itemize any expenses related to a second home such as property taxes and mortgage interest. Remember you can count a boat or RV as a second home as long it has a bathroom and kitchen.
Not every investment is a winner, and you can take deductions on those that you sold at a loss in the prior tax year. This would be shown as reduced earnings against the same class of stocks, such as other long or short-term stocks.
FSA and HSA Contributions.
Healthcare is expensive, and you still have some hefty deductions in the form of Flexible Spending Accounts ($2,650 for 2019) and a Health Savings Account ($3,500 for an individual).
Military Moving Expenses.
While most moving expense deductions have been eliminated, members of the armed forces are still permitted to use this valuable deduction.
2018 marked a year of several natural disasters from major hurricanes to flooding to massive wildfires. If you were the victim of one of the tragedies and in a federal disaster area, you are eligible for some tax relief.
Home Office Space.
If you are self-employed or make some extra cash on the side using a home office, you can claim a deduction for up to 300 square feet of home office space.
Service Animal Training.
IRS Publication 502 states that dog owners can deduct the cost of training and maintaining a service animal to help with hearing-impaired, visually-impaired, or other physical disabilities.
If things didn't go as planned at the casino, you can deduct gambling losses (with the right documentation) up to the extent of your winnings.
Student Loan Interest.
Student loan interest is tax-deductible, and a child can even write off up to $2,500 per year even if their parents are making the payments, provided that child is not considered a dependent of those same parents.
There is now a tax credit equal to 100 percent of the first $2,000 paid in college expenses each year, plus 25 percent of the next $2,000. College expenses refer to payments for tuition, fees, and books.
Stress-Free Banking with City Bank
Whether your goal this year is to buy a home or car, save more, or start a business, City Bank can help. We offer local relationship banking combined with innovative online and mobile tools. Contact us now to learn more about how our services can help you achieve your goals.
*This is for informational purposes only and you should contact a professional tax advisor with any specific tax filing questions.