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Tax Deductions and Credits that are often missed

John J. FureyJanuary 23, 2015

Taxes

Tax filing season for calendar 2014 opened on January 20, 2015. Here is a list of tax deductions and credits that are often missed by taxpayers because they were not aware that the expenses qualified for a tax deduction or credit.

Medical Related

(Total expenses must exceed 10% (7.5% if age 65+) of Adjusted Gross Income to be deductible)

1. Alcoholism and drug abuse treatment

2. Contact lenses, eyeglasses and hearing aids

3. Long-term care insurance premiums

4. Medical transportation costs, including the standard mileage rate of 23 ½ cents

5. Lodging expenses incurred for medical reasons

Employment Related

6. Costs of looking for a new job in your present occupation

7. IRA deduction for contributions made after the end of 2014 but before April 15, 2015

8. Employee’s moving expenses

9. Education that is work related

10. Unreimbursed employee expenses, such as license fees, business subscriptions

11. Health care insurance premiums and 50% of self-employment tax for self-employed

12.Medicare premiums paid by the self-employed

13. Simplified Employee Pension (SEP) IRAs for self-employed

Charity Related

14. Fair market value of property donated to charity

15. Charitable transportation costs, including the standard mileage rate of 14 cents

16. Cost of uniforms not suitable for everyday use

17. Qualified Charitable Distributions (QCDs) from IRAs for those over 70 ½

Taxes

18. Real estate taxes associated with the sale or purchase of property

19. State personal property taxes on cars and boats

20. State sales tax or income tax

Investment Related 

21. Interest paid on a margin account if the margin loan is used for investments

22. Amortization of the premium on taxable bonds

23. Deduction for worthless stock or securities

24. Penalty on early withdrawal of savings

Education Related 

25. Student loan interest deduction*

26. American Opportunity Tax Credit for college*

27. Lifetime Learning Credit*

28. Deduction on PA tax return for contribution to 529 Plans

Other

29. Fees charged for tax preparation services and dealing with IRS audits

30. Casualty and theft losses

31. Military Reservists’ travel expenses

32. Child care credit*

33. Child tax credit*

34. Legal fees paid to secure alimony

35. Gambling losses to the extent of winnings

If you plan to take any of the above deductions or credits, please remember to keep good contemporaneous records to support them. If you have any questions related to any of these items, please do not hesitate to contact our office (610-651-2777).

*These credits are only available if your modified adjusted gross income is below certain thresholds.