Claiming expenses can save you money.

 

Whether you’re a small business owner or loyal employee; preparing your taxes can be a daunting and confusing task. Knowing what purchases qualify as an expense is overwhelming given the number of categories and breaks.

 

To prevent the process from being too stressful, it’s always best to have your expenses overlooked by a trained professional, like ourselves, who will be able to gather, document, send and review all of your expenses throughout the year.

 

However, even if you do approach a professional (such as an accountant, lawyer or financial advisor) you still may not be aware of the unique items that qualify as an expense. That’s why, we’ve outlined 8 of the top things you should be claiming, but probably aren’t, throughout the year.

 

Charitable Gifts

 

Although the majority of taxpayers are aware that they can write off any money (or goods) that are given to charity throughout the year, most are unaware of exactly what this means. This deductible also includes any out-of-pocket expenses that were incurred for the charitable work that was complete.

For example, any supplies, equipment, or bookings that were made for the charity do qualify for the deductible. However, any of the labor that was used to prepare for it cannot be claimed as an expense.

 

Health Insurance Premiums

 

Another thing that taxpayers should be claiming is their health insurance premiums. These premiums can get costly, which is why it’s vital to know exactly what you can submit and get a break on.

It’s important to note that the IRS may be forgiving of these premiums if you are self-employed and responsible for your own health insurance. If you fall into this category you might be able to deduct 100 percent of your premium cost. This works by getting the premium taken off your adjusted gross income rather than an itemized deduction.

 

Babysitting

 

If you happen to volunteer or work for no pay at a recognized charity and need a babysitter to watch your children while you do so, then you might be able to claim this as an expense.

The federal Tax Court has ruled that you can claim the cost of a babysitter as long as you are making charitable contributions (and can document that you were doing so) while they were taking care of your children.

 

Lifetime Learning

 

There are already a number of tax breaks and deductions geared towards students in college. However, when it comes to mature learners (those who have already graduated from a post-secondary institution) most are unaware of the credits you can qualify for. For example, the Lifetime Learning credit can provide up to $2,000 a year, taking off 20 percent of the first $10,000 you spend on education after high school.

Looking for Work

 

Searching for work can mean you are without a steady income for a long period of time. However, this transition can be made easier if you qualify for this credit. So long as you are looking for a job in the same field, you itemize your dedication and these expenses exceed 2 percent of your adjusted gross income, you can qualify.

Home Renovations

 

Renovating a home can be an expensive endeavor, especially if unexpected damages or costs arise. However, this process will be made easier if you are making these changes to your home based on medical purposes. For example, installing a wheelchair ramp, lowering cabinets for better access can be deducted as a medical expense. Keep in mind, simply completing renovations to improve your property value cannot be written off as an expense.

Tax Preparation Fee’s

 

If your self-employed, you will be able to write off tax preparation fees on your miscellaneous tax deduction list. Some costs might include the tax return and electronic filing fees, preparation fees and more.

Home Sale

 

It is also important to note that if you sold your home, and made a profit, you may be eligible for a deduction on your taxes. If you sell at a profit you can exclude up to $250,000 of gains from your income. And, if your married and filing jointly, you can exclude up to $500,000.

Ultimately, filing for taxes can be a tedious ordeal. However, this process can be made easier with the help of a trained professional, like ourselves, who can identify and claim unknown expenses. If you’d like a personal assessment to see if you qualify for any of the tax breaks mentioned above, get in touch.

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