5 Tax Deductions You Aren't Aware of
Tax season can be complicated and stress-inducing for many tax filers, especially when looking for ways to pay no more than we owe, or even boost our tax refunds. Sometimes even with the best intentions tax filers can overlook legitimate tax deductions that they are entitled to. Here are five tax deductions that you probably aren’t aware of.
Health Insurance Premiums:
Medical expenses can put a dent on any budget. Fortunately the IRS is somewhat sympathetic to the cost of insurance premiums. You may be able to claim the amount of your medical expenses that exceeds 10% of your adjusted gross income. If you were self-employed with a net profit in 2016 you may deduct 100% of premiums you paid for medical and dental insurance for yourself, your spouse, and your dependents from your gross income.
If you were a teacher, instructor, counselor, principal, or aide in a private or public elementary or secondary school, you may deduct up to $250 of out of pocket costs for books and classroom supplies.
Tuition and Fees:
You may deduct up to $4,000 of qualifying college tuition and fees that you paid in 2016 if your MAGI (Modified Adjusted Gross Income) doesn’t exceed $65,000 for single and head of household and $130,000 for joint returns.
Damage to your car:
Damage to your car due to an accident may be a deductible, unless caused by your willful conduct such as drunk driving. If at the time of the accident you were using your car on business, you may deduct it as a business loss.
You may be able to deduct moving costs if you move to take your first full time job or if you are returning to work after a long period of working part time or being unemployed. You must meet a 50- mile distance test, and a 39 week or 78 week work test.
Job search expenses:
Unemployment is hard and stressful. Searching for a new job can get costly. Luckily the IRS understands that and allows you to deduct some of your job-hunting expenses on your federal income tax return. To qualify for a deduction, your expenses must be spent on a job search in your current occupation. You can deduct amounts you spend for preparing and mailing copies of your résumé to prospective employers. You may also be able to deduct travel expenses to and from the area to which you travelled.