The IRS is not cruel. He does not want to tax every cent you earn. In fact, it offers a standard deduction - a gift! -. In all taxpayers based on their filing status
For the 2014 tax year, the standard deduction for a single filer under the age of 65 can automatically deduct $ 6,0 from their taxable income, and a married couple filing jointly may deduct $ 12,400 ($ 6,0 married filing separately).
However, depending on your finances, you may be able to reduce your tax burden even further if you itemize deductions.
written in the tax code are allowances for all kinds of deductible expenses.
When you choose to itemize deductions on your federal income tax on income (the famous 1040), trying to seek legal deductions that add more than the standard deduction, giving you a larger refund (or a smaller amount to pay).
This requires keeping careful financial records and a careful reading of the tax rules, but it can pay off come April 15
There are dozens of itemized deductions available, but here are some -unes of the most common deductions claimed by American families:
mortgage interest
This is a real advantage for homeowners whose monthly mortgage checks include huge chunks of interest. By listing deductions, you can deduct 100% of mortgage interest you paid
state and local taxes
This is logical. Why you federal tax on gains you have already spent on national and local taxes?
In the seven states that do not have the income tax, residents can choose to deduct the tax at the point of sale.
gifts and donations
As a way of rewarding charitable donations, the IRS allows taxpayers to deduct the monetary value of gifts given to charities, tax free.
total charitable giving charitable deduction is capped at 50% of adjusted gross income (AGI).
health and dental
IRS recognizes the high cost of health care and permits partial deduction for out-of-pocket medical expenses (not health insurance premiums ).
deduction covers the portion of medical expenses that exceed 10% of your income (7.5% if you are over 65).
Other deductible expenses
You can also deduct certain unreimbursed costs of employment, theft and damage losses, tax preparation fees, and lost the game.
generosity IRS has its limits, however. The tax code applies floors, ceilings and the phasing out of certain itemized deductions.
Floors set a minimum amount that you can start to deduct certain expenses, such as medical expenses of more than 10% of AGI. This 10% is the ground.
There is a whole category of miscellaneous expenses that account if they represent more than 2% of AGI.
Ceilings impose a limit on certain categories of itemized deductions like charitable deductions limit of 50% of AGI.
You can deduct 50% of the cost of meals related to business and entertainment, and gambling losses can not exceed the earnings game.
eliminating some itemized deductions is reserved for the highest incomes.
for fiscal year 2014, the elimination begins for those earning $ 254,0 or couples earning $ 305.050.
elimination applies to most popular itemized deductions including mortgage interest, charitable contributions and taxes paid.
If your income exceeds these thresholds, the total amount of itemized deductions that you can claim is lowered to 3% of each dollar over the limit, up to a maximum reduction of 80%.
0 Komentar