Sunday, February 9, 2014

Huge Tax Deductions That People Rarely Use

By Norbert Higensen


Tax season is right around the corner. Before you start sobbing and crawl under your desk like a frightened puppy, take a second to read about how you can prepare yourself for the tax season gauntlet. There are some simple ways to prepare for this dreaded time of year. Take these steps now, not later, to ensure that when April 15th rolls around, you won't need to go out and find a tax attorney to handle your case.

With billions of dollars in unutilized tax deductions every year across America, those who are taking advantage of the many tax deductions available to them are getting more of their money back in their tax returns.

So what steps can be taken simplify or improve the tax filing process? First, save documents and receipts that can be used for your records; in case of a tax audit and to have them available to input data during the tax filing process. Second, select the software such as Turbo Tax or Quicken if you are filing on your own, or choose a tax company such as H&R Block that can file your taxes for you for a fee. Tax credits can save money

When filing taxes it is important to also look at the various tax credits that individuals or households may be eligible for. Tax credits can take on many forms which range from how much was spent on education to the purchase of energy efficient cars or appliances. This section will focus on the four main tax credits that many people can be eligible:

There are several ways to add deductions on to your taxes. If you pay a mortgage, you can actually claim the interest that you pay on your mortgage as a tax deduction. If a portion of your mortgage payment includes an escrow then it can also be tax deductible. Did you make any donations last year to your church or another organization? Hunt down every possible deduction to reduce the amount you may owe. This is where having a CPA or tax filing company can come in handy.

So even though some may think that it is not worth the few extra bucks they would receive back for donating their unwanted clothing to a second-hand store and getting the request receipt to prove one's donation, the reality is that such donations do qualify for tax deductions and people still fail to claim it. Another common tax deduction that many utilize while still many others neglect is the deduction on healthcare costs.

As with all tax laws, there are specific regulations and requirements that qualify a person to receive a tax deduction equal to their medical expenses, but in general there are two ways for a person to deducted healthcare costs, including healthcare insurance premiums, from their owed taxes.

If you are too prideful to go to one of these companies, remember that there are fantastic programs for filing your taxes on the computer. They usually charge a small fee that is taken out of you return, but they are worth it. If you are still too head-strong for that option, then look online for tax help. There are several websites that offer guidance and tips.

Taxes also can become a venue for tax crimes or may include individuals or companies are delinquent on their taxes. In this case the IRIS can take minimal to strong legal actions against such parties if the law is broken. Those who commit tax fraud or avoid paying their taxes or committing fraud in most cases will require a tax lawyer. Having a professional who can support and protect the interests of these individuals is vital in order to reconcile offences or settling on debts.

These are simply two of the many tax deductions that people routninely miss out on, but there are many, many more such as deducting the points on a home refinance, the points on an old home refinance, personal costs incurred in a business, and plenty of others. This year, take the time to learn all you can about the different tax deductions you qualify for and start receiving the money that is yours.




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