Entrepreneurship University
A Course in Personal Financial Planning

Income Tax

From TurboTax:

You could be leaving hundreds of dollars on the table when you file your tax return this year. From magazines to medical insurance premiums, little-known tax deductions and credits could make tax day a happier one for your family this year.

SWEET, CHARITY

Everyone knows you can deduct charitable contributions but not work you do for charity. But did you know you can deduct the cost of transportation to a charitable event? Heading to a fundraiser? Keep track of your mileage and deduct it come tax time.

NO PLACE LIKE HOME OFFICE

The self-employed are eligible for a variety of tax deductions that other workers aren’t. They can deduct a portion of the cost of utilities or even rent for their home office as well as magazines they subscribe to or member organizations in their career field.

DISASTER RECOVERY

If your home was struck by a natural disaster for which federal aid was issued, you could be eligible to deduct uninsured costs you paid in getting your life back together.

SAVING AND SAVING

Refinancing your mortgage could pay off in more ways than one. You will save each month on the interest for your home loan, and you can deduct any loan points you pay on the refinance.

PRICE OF HEALTH

You can deduct the cost of medical insurance premiums that surpass 10 percent of your adjusted gross income, even if you are covered in an employer plan; for those who are self-employed, the 10 percent threshold for health insurance premiums is removed.

TEACHER APPRECIATION

Educators, including K-12 teachers, teacher aides, instructors or principals, can get an above-the-line tax deduction for materials they buy for use in classrooms. Because it’s an above-the-line deduction, itemizing isn’t required for this deduction.

FINANCIAL PLANNING

Keeping your finances healthy also could land you a healthy tax deduction. Tax planning and investment expenses can be deducted if you itemize and the costs exceed 2% of your adjusted gross income. Investment expenses could include phone calls to your broker or even subscriptions to financial publications like Forbes and Fortune.

WORKING PARENTS

Parents who work and leave their children with a caregiver are eligible for a tax credit to offset the cost of a baby sitter, day care, nursery school or preschool. Limitations on the credit include the age of the child and the percentage of the credit.

MAKING A MOVE

Lucky enough to find a new job, but bummed that
it’s in the next state? You can deduct what you spend packing and moving your belongings as well some costs for storage, insurance, transportation and lodging associated with the move. There’s no limit to the deduction, but your new job must be at least 50 miles farther from your home than your old job.

WORKING 9 TO 6 — AND THEN SOME

For most people, the costs they incur heading to and from work every day are not deductible. For part-time workers, however, if you work two jobs, you can deduct a portion of the costs of getting from one job to the other.