It’s that time of year again… tax season. April will be here soon and there are so many deductions and things you need to be aware of, so you don’t pay more than you have to. Wallet Pop has put together a list of the top ten most overlooked deductions.
1. Mileage Deductions
My husband and I were just discussing this the other night. As a freelance writer I have tried to keep track of the mileage I’ve put on my car driving around to different assignments. What I didn’t know is you can also deduct mileage for medical care. If you have to make frequent medical trips for physical therapy, blood work etc., this applies to you. For 2009 the medical mileage deduction is 24 cents per mile. Do you volunteer regularly for a charity? Well, you can also take a deduction for those miles. This rate is 14 cents per mile.
2. Tax Deduction Even If You Don’t Itemize
A new law was passed in 2008 and it lets you increase your standard deduction by the amount of real property tax you could have claimed if you did itemize and that’s up to $500.
3. New Vehicles
If you purchased a car between Feb. 17 and Dec. 31 of last year, you are able to deduct the sales and excise taxes that you paid. That’s up to a maximum price of $49,500.
4. State Tax Deduction
If you paid state income taxes in the spring, don’t forget to count it towards your 2009 state income tax deduction.
5. “Going Green”
You can get a tax credit for up to 30 percent of your cost for an energy efficient heating and cooling system. Any improvements that you made to your home to help save energy can also get you a tax credit up to $1,500.
6. Selling Your Home
My husband and I were finally able to sell our home in Florida in late 2009. I didn’t realize that if you sold a home last year, you can get some tax deductions. You can deduct the money that you had to pay, such as closing costs and the commission to your agent.
7. Deductions for Homeowners
Are you paying private mortgage insurance? If so, that expense is deductible. This applies if you took out a first mortgage or refinanced after Jan. 1, 2007.
8. Deductions for Investors
Write off any investment publications that you subscribe to. You can also deduct expenses such as financial advisor fees, mileage and safety deposit boxes.
9. Those Who Are Unemployed
The American Recovery and Reinvestment Act made the first $2,400 you receive in unemployment benefits tax free. You also might be able to deduct your job search expenses like resume preparation, phone calls, travel and employment agency fees.
10. Working Parents
Paying for childcare is expensive and if this is you, you can reduce your taxes up to $3,000 for one child and up to $6,000 for two or more! The tax credit depends on your gross income. If you make $43,000, you can claim a 20 percent credit on your costs, says Wallet Pop.