Income Tax Deductions
Adjustments to Income
A list of the various adjustments to income. These are reported on the first page of Form 1040.
Maximize your itemized deductions with a handy list of tax deductions, along with information and advice on handling limitations to deductions.
Alimony Paid Deduction
Alimony paid to a former spouse is tax-deductible, as long as certain requirements are met.
Car and Truck Expenses
Car and truck expenses can be tax-deductible if you drive your car for business, medical, or charitable purposes. Learn more about what expenses are deductible, and what records to keep, and how to report this on your tax return.
Casualty & Theft Losses
Losses incurred because of a casualty, disaster, or theft may be tax-deductible. Casualty and theft losses are reported on Form 4684 and Form 1040 Schedule A.
Donations of cash and property to qualified non-profits are tax deductible. To be deductible, taxpayers must keep records of their contributions, especially of any gifts over $250. For non-cash contributions, taxpayers must keep records indicating the value and condition of the property given to charity.
Classroom Expenses Deduction
If you are a teacher, and you paid for classroom supplies and other materials out of your own pocket, you can claim those expenses on Form 1040 line 23.
Community Property Deductions
Married couples who file separate federal tax returns need to identify community income and community deductions so they will know how much each spouse should report on a separately filed tax return.
Domestic Production Activities Deduction (Section 199)
Businesses with "qualified production activities" can take a tax deduction of 3% from net income. This is a tax break pure and simple. The more complicated the business, the more complicated the math for calculating the Domestic Production Activities Deduction. In a nutshell, businesses engaged in manufacturing and other qualified production...
Early Withdrawal Penalty Deduction
If you incurred a penalty for early withdrawal of your certificate of deposit at a bank, you can deduct that penalty as a tax deduction on Form 1040.
Education Tax Breaks
The federal government provides several tax incentives for college students and their parents. Here's an overview of the key tax breaks for pursuing post-secondary education.
Health Savings Account Deduction
You can take an above-the-line tax deduction for contributions to a qualified health savings account (HSA) plan if you are covered by a high-deductible health insurance plan, and you are not covered by any other health insurance plan.
Investment Interest Expense Deduction
Investors who borrow money to invest may be able to deduct interest paid on the loan. Investment interest is deducted, subject to limitations, as an itemized deduction.
IRA Deduction (Traditional Individual Retirement Account)
Contributions to a traditional, tax-deferred individual retirement account (IRA) can be deducted against income taxes. Up to $5,500 can be contributed to an IRA for 2013.
Job Search Tax Deduction Tips
If you are searching for a job, you can deduct your job search expenses as an itemized deduction on your Schedule A. Find out which job hunting expenses are tax-deductible.
Limitations on Itemized Deductions
When you itemize your deductions, certain limitations apply. Learn about limitations on various types of deductions, plus the overall limitations on itemized deductions.
Medical expenses represents a category of expenses for which an individual may be eligible to receive various tax breaks. Medical expenses that meet certain qualifications may be eligible for an itemized deduction for medical expenses, or tax-free reimbursement from a flexible spending account, health reimbursement account, or health savings...
Mortgage Insurance Premium Tax Deduction
Mortgage insurance premiums may be tax deductible. To qualify, the insurance policy must be for home acquisition debt on a first or second home. This itemized tax deduction is valid for the years 2007 through 2013.
Mortgage Interest Tax Deduction
Mortgage interest is a tax-deductible expense. Mortgage interest is reported on Form 1040, Schedule A along with other itemized deductions. Taxpayers paying mortgage interest should fill out Schedule A to see if their itemized deductions exceed their standard deduction. If so, taxpayers will save more money on their taxes by itemizing.
Moving Expenses Tax Deduction
If you moved to start a new job, or to seek work in a new city, you may be able to deduct the cost of your moving expenses from your income. Moving expenses are subject to a time and distance test. Find out if you qualify to deduct your moving expenses.
Personal exemptions lower your taxable income. Find out your personal exemptions and the phase out limits on exemptions.
Personal Property Tax Deduction
Personal property taxes are deducted on Schedule A as an itemized deduction.
Property Tax Deduction
Homeowners can deduct real estate taxes on Schedule A as an itemized deduction.
Qualified Performing Artists (QPA) Deduction
Certain professions can deduct their job-related expenses directly on Form 1040 as an adjustment to income. Professions include performing artists such as musicians, dancers, and actors. Instructions for claiming the "QPA" deduction are discussed.
Qualified Performing Artists Expenses: Claiming a Tax Deduction for Job Expenses
Qualified performing artists, members of the Reserve or National Guard, and fee-based government officials can claim job-related expenses as a tax deduction.
Sales Tax Deduction
Sales tax may be a deductible against your federal income taxes. This is an itemized deduction and is claimed on Schedule A. The sales tax deduction is available only for the years 2005 through 2013.
Self-Employment Health Insurance Deduction
Self-employed persons can deduct the full cost of health insurance premiums. The deduction is taken on Form 1040 as an adjustment to income, and reduces the federal income tax but not the self-employment tax.
Self-Employment Tax Deduction
If you have self-employment income, then you can take a deduction for half of your Self-Employment Tax. This deduction is taken directly on Form 1040.
SEP, SIMPLE, Retirement Plan Deduction
If you have self-employment income, then you can take a tax deduction for contributions you make to a SEP, SIMPLE, or Keogh retirement plan. Your maximum contribution to a SEP-IRA is 20% of your self-employment income or $42,000, whichever is less.
Taxpayers can opt to take a standard deduction (a flat dollar amount that reduces taxable income) or itemize their deductions instead. The standard deduction amount varies by a person's filing status, age, and whether they are blind.
State Income Tax Deduction
Individuals can deduct state and local income taxes paid during the year if they itemize their deductions.
Student Loan Interest Deduction
You can claim up to $2,500 of student loan interest you paid as an above-the-line tax deduction.
Tuition and Fees Deduction for College Expenses
Taxpayers can deduct up to $4,000 per student using the tuition and fees deduction.
Unreimbursed Employee Business Expenses
Employees can deduct job-related expenses as miscellaneous itemized deductions on their federal tax return. Learn what types of expenses can be deducted, which tax forms are used, and what documentation is needed to support the deduction.
Vehicle Sales Tax Deduction
A one-year-only deduction for 2009, individuals who purchase a new vehicle (including motor homes) can deduct sales tax or excise taxes, even if they don't itemize. The deduction is limited to the sales or excise tax applicable to the first $49,500 in the vehicles purchase price, and the deduction phases out at an adjusted gross income of $125,000 (or $250,000 for joint filers).
Additional Standard Deduction Amount for Property Taxes
The Housing Assistance Tax Act of 2008 allows homeowners to claim an additional standard deduction for property tax if the taxpayer does not itemize. The additional amount is limited to $500 or $1,000 for joint filers.
Home Office Deduction
Individuals who work from home may be eligible to deduct the cost of their home office. Typically, a home office must be used regularly and exclusively for business purposes.
Tax Preparation Fees Deduction
Tax preparation fees can be deducted as a miscellaneous itemized deduction on Schedule A. Tax preparation fees can also be deducted on other parts of the tax return, such as Schedule C, E or F.