Deductions & Credits
Deductions lower your taxable income, and credits lower your taxes.
Tax Deduction for Charity Donations
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.
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.
Home 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.
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.
Energy Tax Credits
Summary of federal tax credits available for homeowners who purchase energy-efficient equipment. More information about the Residential Energy Credits.
Summary of federal tax credits available for homeowners who purchase energy-efficient equipment. More information about the Residential Energy Credits.
Other Tax Credits - Form 1040
How to fill out Form 1040 Lines 54 and 55 to claim other tax credits.
How to fill out Form 1040 Lines 54 and 55 to claim other tax credits.
Adoption Tax Credit: How to Claim the Adoption Credit
You qualify for the adoption tax credit if you adopted a child and paid out-of-pocket expenses relating to the adoption.
You qualify for the adoption tax credit if you adopted a child and paid out-of-pocket expenses relating to the adoption.
Child Tax Credit: How to Claim the Child Tax Credit on Form 1040
If you have children, you qualify for the Child Tax Credit. Find out how to fill out the child tax credit worksheet and if you need to file IRS Form 8901.
If you have children, you qualify for the Child Tax Credit. Find out how to fill out the child tax credit worksheet and if you need to file IRS Form 8901.
Retirement Savings Contribution Credit
If you contribute to a retirement plan, you may qualify for the Retirement Savings Tax Credit. How to fill out IRS Form 8880.
If you contribute to a retirement plan, you may qualify for the Retirement Savings Tax Credit. How to fill out IRS Form 8880.
Education Credits - Hope and Lifetime Learning Tax Credits
You can reduce your taxes by claiming a tax credit for education expenses. Learn about the Hope Credit, the Lifetime Learning Credit, and other information for Form 8863.
You can reduce your taxes by claiming a tax credit for education expenses. Learn about the Hope Credit, the Lifetime Learning Credit, and other information for Form 8863.
Credit for the Elderly or Disabled - Form 1040 Line 48
If you are age 65 or older, or if you are disabled, you can reduce your taxes with the tax credit for the elderly or the disabled. How to fill out Schedule R.
If you are age 65 or older, or if you are disabled, you can reduce your taxes with the tax credit for the elderly or the disabled. How to fill out Schedule R.
Child Care Tax Credit & Dependent Care Expenses - Form 1040 Line 48
The Child & Dependent Care Tax Credit reduces your taxes by providing a tax credit for money you spend on day care and child care services. Find out how to qualify for the Child Care Tax Credit and how to fill out Form 2441.
The Child & Dependent Care Tax Credit reduces your taxes by providing a tax credit for money you spend on day care and child care services. Find out how to qualify for the Child Care Tax Credit and how to fill out Form 2441.
Adjustments to Income - Preparing Your 1040 Step 5
How to calculate and claim various tax deductions known as "above-the-line" deductions or adjustments to income. These deductions directly reduce your income, and you don't need to itemize. Line-by-line instructions for Form 1040 lines 23 to 34.
How to calculate and claim various tax deductions known as "above-the-line" deductions or adjustments to income. These deductions directly reduce your income, and you don't need to itemize. Line-by-line instructions for Form 1040 lines 23 to 34.
Adoption Credit - Form 1040 Line 52
You qualify for the adoption tax credit if you adopted a child and paid out-of-pocket expenses relating to the adoption. How to fill out Form 8839 and Form 1040 Line 52.
You qualify for the adoption tax credit if you adopted a child and paid out-of-pocket expenses relating to the adoption. How to fill out Form 8839 and Form 1040 Line 52.
Alimony Paid Tax Deduction
If you paid alimony or separate maintenance to your ex-spouse, report the total amount of alimony you paid during the year as a tax deduction on Form 1040.
If you paid alimony or separate maintenance to your ex-spouse, report the total amount of alimony you paid during the year as a tax deduction on Form 1040.
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.
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.
Child Care Tax Credit & Dependent Care Expenses - Form 1040 Line 47
The Child Care Tax Credit reduces your taxes by providing a credit for money you spend on day care and child care services. Find out how to qualify for the Child Care Tax Credit and how to fill out Form 2441.
The Child Care Tax Credit reduces your taxes by providing a credit for money you spend on day care and child care services. Find out how to qualify for the Child Care Tax Credit and how to fill out Form 2441.
Child Tax Credit - Form 1040 Line 51
If you have children, you qualify for the Child Tax Credit. Find out how to fill out Form 1040 Line 51 and the child tax credit worksheet.
If you have children, you qualify for the Child Tax Credit. Find out how to fill out Form 1040 Line 51 and the child tax credit worksheet.
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.
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.
Credit for the Elderly or Disabled - Form 1040 Line 48
If you are age 65 or older, or if you are disabled, you can reduce your taxes with the tax credit for the elderly or the disabled. How to fill out Schedule R and 1040 line 48.
If you are age 65 or older, or if you are disabled, you can reduce your taxes with the tax credit for the elderly or the disabled. How to fill out Schedule R and 1040 line 48.
Domestic Production Activities Deduction - Section 199 Deduction for Domestic Production Activities
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 activities will need to implement cost accounting mechanisms to make sure their tax deduction is accurately calculated.
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 activities will need to implement cost accounting mechanisms to make sure their tax deduction is accurately calculated.
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.
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.
Earned Income Credit: Qualfying for the Earned Income Tax Credit
How to qualify for and figure your earned income credit. The EITC is a tax credit that lowers your taxes and gives you a bigger refund. Find out the criteria for qualifying children, and the special Head of Household rule if you are separated from your spouse.
How to qualify for and figure your earned income credit. The EITC is a tax credit that lowers your taxes and gives you a bigger refund. Find out the criteria for qualifying children, and the special Head of Household rule if you are separated from your spouse.
Education Credits, Hope Credit, Lifetime Learning Credit, Form 1040 Line 49
You can reduce your taxes by claiming a tax credit for education expenses. Learn about the Hope Credit, the Lifetime Learning Credit, and other information for Form 1040 line 29 and Form 8863.
You can reduce your taxes by claiming a tax credit for education expenses. Learn about the Hope Credit, the Lifetime Learning Credit, and other information for Form 1040 line 29 and Form 8863.
Educator Expenses: Claiming a Tax Deduction for Educator Expenses
If you are a teacher and you paid for classroom supplies and other materials out of your own pocket, you can claim those expenses as a tax 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 as a tax deduction.
Foreign Tax Credit - Form 1040 Line 46
Claiming the foreign tax credit reduces your US taxes by the amount of tax you have paid to foreign governments. An excellent tax strategy for investors and people working abroad.
Claiming the foreign tax credit reduces your US taxes by the amount of tax you have paid to foreign governments. An excellent tax strategy for investors and people working abroad.
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.
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.
Moving Expenses
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.
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.
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.
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.
Self-Employment Health Insurance Deduction
You can deduct the full cost of health insurance you purchase for yourself, your spouse, and/or your dependents. You must be self-employed, and you must not be eligible to participate in a group health plan.
You can deduct the full cost of health insurance you purchase for yourself, your spouse, and/or your dependents. You must be self-employed, and you must not be eligible to participate in a group health plan.
SEP-IRA Deduction
You can take a tax deduction for any retirement contributions you make to a SEP, SIMPLE, or Keogh retirement plan. You must be self-employed to claim this tax break.
You can take a tax deduction for any retirement contributions you make to a SEP, SIMPLE, or Keogh retirement plan. You must be self-employed to claim this tax break.
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.
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.
Alimony Paid Deduction
If you paid alimony or separate maintenance to your ex-spouse, report the total amount of alimony you paid during the year on Line 34 of your Form 1040.
If you paid alimony or separate maintenance to your ex-spouse, report the total amount of alimony you paid during the year on Line 34 of your Form 1040.
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.
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.
Health Savings Account Deduction: Tax Deduction for Health Savings Accounts
Contributions to a health savings account (HSA) are tax deductible. Tax deductions are limited to $2,650 for individual insurance coverage and $5,250 for family insurance coverage for tax year 2005. To be tax-deductible, HSA contributions must meet certain criteria.
Contributions to a health savings account (HSA) are tax deductible. Tax deductions are limited to $2,650 for individual insurance coverage and $5,250 for family insurance coverage for tax year 2005. To be tax-deductible, HSA contributions must meet certain criteria.
How To Pay Zero Taxes 2005 (Book Review)
Review of the book, "How To Pay Zero Taxes, 2005: Your Guide to Every Tax Break the IRS Allows," by Jeff A. Schnepper. Recommended for anyone who wants to implement long-term tax strategies to reduce or eliminate their tax liabilities.
Review of the book, "How To Pay Zero Taxes, 2005: Your Guide to Every Tax Break the IRS Allows," by Jeff A. Schnepper. Recommended for anyone who wants to implement long-term tax strategies to reduce or eliminate their tax liabilities.
Hybrid Car Tax Credit – Essential Information about the Alternative Motor Vehicle Credit
Qualifying vehicles purchased on or after January 1, 2006, will be eligible for a tax credit ranging from $400 to $3,400 based on fuel economy. The hybrid car tax credit is actually a combination of two separate tax credits. The math is complicated, and fortunately you won't have to calculate it. The car manufacturers and the IRS will certify the tax credit amount of qualifying vehicles.
Qualifying vehicles purchased on or after January 1, 2006, will be eligible for a tax credit ranging from $400 to $3,400 based on fuel economy. The hybrid car tax credit is actually a combination of two separate tax credits. The math is complicated, and fortunately you won't have to calculate it. The car manufacturers and the IRS will certify the tax credit amount of qualifying vehicles.
Hybrid Car Tax Deduction - Clean Burning Fuel Deduction
Which hybrid cars qualify for the clean-burning fuel tax deduction? How much is the tax deduction? Eric Powers, your Guide to Hybrid Cars, answers these questions on the Clean Fuel Deduction.
Which hybrid cars qualify for the clean-burning fuel tax deduction? How much is the tax deduction? Eric Powers, your Guide to Hybrid Cars, answers these questions on the Clean Fuel Deduction.
IRA Deduction (Traditional Individual Retirement Account)
If you contributed to a traditional IRA for 2004, you can take an above-the-line tax deduction for your contribution. Your deduction reduces your taxable income dollar-for-dollar.
If you contributed to a traditional IRA for 2004, you can take an above-the-line tax deduction for your contribution. Your deduction reduces your taxable income dollar-for-dollar.
Itemized Deductions
Maximize your itemized deductions with a handy list of tax deductions, along with information and advice on handling limitations to deductions.
Maximize your itemized deductions with a handy list of tax deductions, along with information and advice on handling limitations to deductions.
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.
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.
When you itemize your deductions, certain limitations apply. Learn about limitations on various types of deductions, plus the overall limitations on itemized deductions.
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.
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.
Other Tax Credits - Form 1040 Line 53
How to fill out Form 1040 Lines 53 and 54 to claim other tax credits.
How to fill out Form 1040 Lines 53 and 54 to claim other tax credits.
Personal Exemptions
Personal exemptions lower your taxable income. Find out your personal exemptions and the phase out limits on exemptions.
Personal exemptions lower your taxable income. Find out your personal exemptions and the phase out limits on exemptions.
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.
Qualified performing artists, members of the Reserve or National Guard, and fee-based government officials can claim job-related expenses as a tax deduction.
Retirement Savings Credit, Form 1040 Line 50 & Form 8880
If you contribute to a retirement plan, you may qualify for the Retirement Savings Tax Credit. How to fill out Form 1040 Line 50 and Form 8880.
If you contribute to a retirement plan, you may qualify for the Retirement Savings Tax Credit. How to fill out Form 1040 Line 50 and Form 8880.
Self Employment Tax Deduction
If you have self-employment income, then you can take a deduction for half of your Self-Employment Tax. Self-employment income includes any of the following: net profit from a Schedule C, guaranteed payments from a Partnership, or wages from an S-Corporation. This deduction reduces your regular income tax.
If you have self-employment income, then you can take a deduction for half of your Self-Employment Tax. Self-employment income includes any of the following: net profit from a Schedule C, guaranteed payments from a Partnership, or wages from an S-Corporation. This deduction reduces your regular income tax.
Self-Employment Health Insurance Deduction
You can deduct the full cost of health insurance you purchase for yourself, your spouse, and/or your dependents. You must be self-employed, and you must not be eligible to participate in a group health plan.
You can deduct the full cost of health insurance you purchase for yourself, your spouse, and/or your dependents. You must be self-employed, and you must not be eligible to participate in a group health plan.
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.
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.
Standard Deduction
Make the most of your tax deductions. Take the larger of your standard deduction or your itemized deductions. Tips for figuring your tax liability.
Make the most of your tax deductions. Take the larger of your standard deduction or your itemized deductions. Tips for figuring your tax liability.
Student Loan Interest Deduction
You can claim up to $2,500 of student loan interest you paid in 2004 as an above-the-line tax deduction on Form 1040 line 26.
You can claim up to $2,500 of student loan interest you paid in 2004 as an above-the-line tax deduction on Form 1040 line 26.
Student Loan Interest Tax Deduction
You can claim up to $2,500 of student loan interest you paid as an above-the-line tax deduction on Form 1040.
You can claim up to $2,500 of student loan interest you paid as an above-the-line tax deduction on Form 1040.
Tax Credits
Claiming tax credits is an important step in reducing your taxes. Find out about the tax credits you may qualify for.
Claiming tax credits is an important step in reducing your taxes. Find out about the tax credits you may qualify for.
Traditional IRA Tax Deduction - Individual Retirement Account Deduction
If you contributed to a traditional individual retirement account (IRA), you can take an above-the-line tax deduction for your contribution on Form 1040. Your deduction reduces your taxable income dollar-for-dollar.
If you contributed to a traditional individual retirement account (IRA), you can take an above-the-line tax deduction for your contribution on Form 1040. Your deduction reduces your taxable income dollar-for-dollar.
Tuition and Fees Deduction for College Expenses
You can deduct cost of college tuition and other mandatory school fees.
You can deduct cost of college tuition and other mandatory school fees.
Tuition and Fees Tax Deduction
If you took college classes, you can deduct cost of tuition and school fees on Form 1040.
If you took college classes, you can deduct cost of tuition and school fees on Form 1040.
The Top 10 Personal and Business Insurance Tax Tips
When tax time comes there can be an array of questions about deductions and what to report as income. This Insurance Tax Do's and Don'ts list of tax tips will hopefully help many with tax questions regarding insurance whether on a personal or business level.
When tax time comes there can be an array of questions about deductions and what to report as income. This Insurance Tax Do's and Don'ts list of tax tips will hopefully help many with tax questions regarding insurance whether on a personal or business level.
Tax Mistakes 90% of Self-Employed People Make
Tips for keeping track of business expenses, especially for self-employed people.
Tips for keeping track of business expenses, especially for self-employed people.
Smart Tax Strategies for MBAs
CPA James Vonachen discusses the tax benefits for pursuing an MBA, such as the Lifetime Learning Credit, the Tuition & Fees Deduction, itemized deductions for job-related expenses, and strategies for companies to help their employees pursue an MBA. Vonachen was interviewed by Business Week reporter Mica Schneider.
CPA James Vonachen discusses the tax benefits for pursuing an MBA, such as the Lifetime Learning Credit, the Tuition & Fees Deduction, itemized deductions for job-related expenses, and strategies for companies to help their employees pursue an MBA. Vonachen was interviewed by Business Week reporter Mica Schneider.
Do You Qualify for the Earned Income Credit?
Answer a few simple questions to find out if you are eligible for the Earned Income Tax Credit.
Answer a few simple questions to find out if you are eligible for the Earned Income Tax Credit.
The Complete Idiot's Guide to Tax Breaks and Deductions (Book Review)
Review of the book, "The Complete Idiot's Guide to Tax Breaks and Deductions," by Lita Epstein. Epstein has an ambitious goal: to produce a tax book that lives beyond April 15th as a handy guide to tax planning.
Review of the book, "The Complete Idiot's Guide to Tax Breaks and Deductions," by Lita Epstein. Epstein has an ambitious goal: to produce a tax book that lives beyond April 15th as a handy guide to tax planning.