Are You Cheating On Your Taxes? Cheating Yourself That Is – Discover How To Save Hundreds Or More
Many people are cheating on their taxes. That’s right. They are cheating themselves. By not keeping extemporaneous, complete, and accurate records of tax-deductible expenses, many taxpayers are paying more than they are obligated to pay. If you can relate to this scenario, or even if you think you might be able to do better, take note of these specific items and make a concerted effort to keep track of your expenses.
Most Poorly Tracked Deductions:
1. Charitable Cash Donations: Most taxpayers realize that if they itemize their deductions, they can take a deduction for charitable contributions. What they fail to keep track of is the smaller donations that they make to volunteer fire companies, school non-profit associations, and many other
2. Charitable Service or Non-Cash Donations: These non-cash donations are one of the most overlooked areas by tax preparers, CPAs, and self-preparers. It does take a little more effort to keep track of the items of clothing, household goods, and furniture or appliances that you donate to local charities, but the potential deductions and income tax savings you receive can be in the hundreds or even thousands per year depending on your charitable efforts.
3. Work-Related Expenses: Many employees have expenses that are not reimbursed that can qualify for a tax deduction as un-reimbursed employee business expenses. For many, this could include business gifts, overnight travel, uniforms, off-site parking expenses, union dues, and licensing fees among others. If you are already itemizing on Schedule A, you need to keep track of these to see if you have enough to qualify.
4. Business, Medical, or Charitable Mileage: many taxpayers are unaware that the IRS allows you to take a deduction for automobile mileage if you are using your vehicle and gas for business, medical or charitable purposes. You may have to meet certain minimums for business and medical miles before you qualify, but charitable can be added directly to your itemized deductions. Each type of mileage is given a different rate per mile driven, with business being the highest, and medical and charitable being the lowest. these mileage deductions can add up quickly if you qualify, so keep track of your driving purposes.
5. Meals and Entertainment: Most people realize that business people can deduct meals and entertainment expenses, but many employees can too. If you work at different job sites for your company and you stop to get food while traveling between sites, this could be deductible. If you incur expenses for entertaining business-related customers or contacts and you are not reimbursed for these expenses, they may be deductible too, so keep track.
6. Education and Job-Seeking Expenses: If you are required to attend and pay for continuing education or education expenses to help improve your job skills and increase your income, these costs may be deductible. Your costs for classes, seminars, books, and supplies may also be added to this total. You are also entitled to take a deduction for expenses incurred while looking for work or a new job, but you need to keep track of these items and let your tax adviser know.
Summary:
By keeping better records and asking questions about whether various items are deductible, the average taxpayer can save hundreds of dollars every tax year in multiple ways. Just be sure to ask your tax adviser to review all your possible deductions each year and let you know what other possible deductions that you may be entitled to. Depending on your income tax bracket and your state’s tax rates, you could save up to $40 for every $100 of extra or overlooked itemized deductions that you qualify to take advantage of.
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