The old saying goes that death and taxes are the only things we can be sure about, and every year we welcome a new season and the grudging realization that it’s time to start thinking about paying Uncle Sam. Some of us don’t find the process so painful especially if we get a refund, and with that in mind we offer you some of the most overlooked tax deductions. Below are some suggestions on where to look for extra deductions when you file this year; the IRS also has a lot of detailed pamphlets on items you can deduct and how to do it. For those who have them, your tax accountant can also look over your financial circumstances to give you a well informed answer.
That’s right, there’s a reason why they say dog is man’s best friend, they were talking about tax deductions! Actually, it’s a little more involved than that, if you happen to move because of your job, you may be able to use the costs associated with moving your pet as a deduction later on. You may also qualify for a deduction if your pet helps your business, like a farmer whose cats help to catch and control the mouse population around their farm. Both require documentation, so make sure to have the proper paperwork that can support your claim.
If you built a swimming pool for health purposes (at your doctor’s suggestion), and it’s used for medical or therapeutic reasons then you may be able to include it in the deductions for your taxes. This includes all the costs associated with owning a pool (cleaning, supplies, etc.), but you must be able to prove that the pool’s use is for health and not recreational purposes.
If you used a credit card to pay for the taxes you owed, you can actually deduct any convenience charges the credit card company charged you in handling the transaction. You can include this as a miscellaneous deduction, and it can apply to both federal and state taxes. However, you can only write get a write-off to the extent that the total of your miscellaneous deductions do not exceed 2% of your adjusted gross income.
Finally, that ugly uniform your job makes you wear is good for something, you can write it off, as long as it’s something you can only wear for work. So someone who works in retail can’t use the cute dress she bought as a deduction in her taxes, but if she’s a showgirl or a theme park character, that’s another story.
If you’re looking for a job it might be in your interest to keep track of what you’re spending while you’re out searching for that career change. On the condition that this isn’t your first job, things like food, shelter, transportation, and agency fees spent on job hunting can all be deducted from your taxes. If you’re looking for work in the same field you’re in, that could count as a miscellaneous expense if you itemize, but only to the extent that these itemized expenses do not exceed 2% of your adjusted gross income.
Taxes (or death, for that matter) may not be on our list of favorite things to do, but if you do a little digging, you might find a way to gain some financial breathing room this tax season. And who knows, with a little luck, that room can probably be itemized too.