Last Minute Ideas!

Last Minute Ideas!

hourglassDid you file yet?   Here’s a few ideas for saving on your income tax:

  • Consider if you have dependents that you can claim that you haven’t thought of.  Perhaps your parents are dependents?  Are you supporting them?  Kids in college are also normally still dependents. The IRS has an interview tool you can complete to see if someone meets the required tests to be a dependent.
  • Don’t forget about college expenses.  Generally, you can deduct education AND ALSO BOOKS if you are using the American Opportunity Credit.  Your student should have gotten, or should request Form 1098-T from the college/trade school/etc. that they attending.  There are also other possible tax saving options related to education.
  • Did you make any Energy Home Improvements in 2016? There is a $500 lifetime limit for this credit.
  • Put money in an IRA or Health Savings Account if it’s allowable, before April 18th.
  • Did you pay large medical, dental, and/or optical bills.  There is a large list of Qualified Medical Expenses. Contacts, eyeglasses, dentures, hearing aids and other medical supplies count.  These must be over 10% of your Adjusted Gross Income though and you can’t have paid them with before-tax funds so it’s hard to get a deduction for this.
  • Did you pay Long Term Care Insurance?  There’s a deduction for that.
  • Paid PMI? This Private Mortgage Insurance that insures the bank in case you don’t pay is deductible in 2016 but no longer after that. Once you have 20% equity you may want to talk to the bank to get that removed as a charge.
  • Home Office?   If you are supplied with anywhere to work from your job, or you are self employed, and use a room regularly and exclusively for business, then you may be able to get this deduction.
  • Did you have mileage for charitable purposes?   You can’t deduct your TIME volunteering, but you CAN deduct the mileage for it. Here are some tips for taxpayers who travel for charity work.

Linda Reinhardt

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