Take Advantage of Some Commonly Overlooked Tax Deductions for 2013 Tax Season

Start Preparing Now for the 2013 Tax Season
Take Advantage of Some Commonly Overlooked Tax Deductions

With 2014 still months away, the last thing you probably want to do is think about your taxes. However, many experts say now is a good time to start looking for ways to increase your refund or reduce the amount you owe when you file your 2013 returns. The best way to do that is to make sure you understand all the deductions you deserve, and that you take them if you can. To help you, we have compiled the list below of some commonly overlooked tax deductions. Take a minute to review them, and be sure to discuss them with your tax advisor.

State sales taxes – The state sales tax deduction allows you to choose between deducting your state income taxes or your state sales taxes. This is useful in states where income tax is not imposed. In some situations it may be useful for those living in states where income tax is imposed, if those individuals made large purchases throughout the year, such as a home, car, boat, etc. A lot of confusion surrounded the state sales tax deduction in 2012, because a loophole in federal law made it unavailable for that year. However, the law has been fixed and it will once again be available in 2013.

Student loan interest paid by parents – It used to be that if a parent made payments on their child’s student loan, the interest was not tax deductible. However, changes in the law now allow it. If parents make payments on a student loan, the IRS treats is as if the child paid on the loan, thereby allowing the child to take the deduction.

Non-cash charitable contributions – It’s easy to remember the big charitable donations you made throughout the year, such as to your favorite non-profit organization. But if you volunteered for that or any other non-profit, you may be overlooking a tax deduction. For example, you can deduct some out-of pocket expenses you may have incurred during the course of your service, such travel expenses or the value of items purchased or donated for a fundraising event.

Points paid to obtain your mortgage – Recent turmoil in the housing market has caused many homeowners to refinance their homes, so this deduction may be more useful this year than ever. The points you pay to obtain your mortgage are deductible. The points must be deducted over the life of the loan, so in some cases it may not amount to much. However, every little bit helps when it comes to saving on your taxes, so be sure to deduct those points if you are eligible.

State tax liability from 2012 – If you owed state income taxes when you filed your 2012 returns, and you paid the bill in full, you may be able to deduct a portion of that payment on your 2013 returns.

Job search expenses – Unfortunately for some, when it comes time to claim this deduction they find they failed to properly document their job search expenses. If you are currently searching for a job, you may be able to deduct the costs of such items as postage, costs of resumes, fees paid to employment agencies–and under some circumstances, travel expenses associated with your search.

September 20, 2013 · Jennifer · No Comments
Tags:  · Posted in: 2013 Overlooked Tax Deductions, TAXES

Leave a Reply