How to Find Free Money in Your Tax Refund – Credits and Deductions You Never Knew About
It has been said that there are only two certainties in life: Death and taxes – and sometimes it’s hard to tell which one people dread the most! Without a doubt, taxes are a necessary evil, giving both state and federal governments the ability to provide aid to needy citizens, improve public spaces like roads and parks, enhance the school system, and more – but that doesn’t mean that anyone actually enjoys dropping their tax return in the mail every April. Fortunately, there is one way to make the entire process a little less agonizing: Discovering ways to find free money in your tax refund! There are many different credits and deductions that you may be qualified for, and they can add up in a big way – although they may not always be immediately obvious. Here are a few of the most commonly overlooked credits and deductions to get you started:
Education. If you’re a student – whether full or part-time – you may be able to qualify for a special credit that will help cover the cost of books, tuition and more. Similarly, if you are studying a subject that is pertinent to your career, you may be able to deduct your expenses. Ask your accountant or tax specialist for more information.
Sales tax. That’s right – you may be able to deduct the cost of your state’s sales tax, particularly on “big ticket items” like a new car or a major electronics purchase.
Energy-saving home improvements (i.e., solar panels). In the interest of helping citizens “go green,” the government is offering tax credits for many different home improvement projects that will help families reduce their collective carbon footprint, such as the installation of solar panels in the home.
Charitable donations. Most people remember to write off cash donations, but don’t forget about goods and items you may have donated as well, such as clothing, canned food, books, or used electronics. If you donated an item worth more than $500, make sure to have it appraised – and include the appraisal fees in your deduction. If you frequently travel for charity (for example, if you drive to a different town in order to volunteer), you can even include your transportation costs in the deduction.
Home selling fees. If you’ve sold your home over the past year, don’t forget to deduct property tax for the portion of the year you still lived in the house, real estate agent fees, closing fees, and other pertinent expenses.
Work-related travel expenses are a popular deduction, but many people overlook additional opportunities for free money, including the cost of transportation, lodging, cleaning business suits, shipping items (like luggage), and access to phone, fax or Internet while on the road.
Finally, don’t forget to account for your tax preparation fees! If those costs exceed 2% of your adjusted gross income, you can write them off – and don’t forget about the cost of transportation to and from your accountant’s office.
As with any tax credit or deduction, always keep detailed records and save your receipts when necessary – these documents may prove themselves to be invaluable in the event of an audit.