Overlooked Tax Deductions

Popular Irs Credits And Deductions You Might Be Missing

Child and Dependent Care
Be sure to check if you apply for a child-care credit. If you have kids then you know that childcare is not cheap, and child care credits are a great way to offset the costs. Even with reimbursement programs you may still qualify, but this credit is a little tricky so be sure to research it before you include it on your return.

Job Hunting
With job losses at an all-time high, there is a lot of job searching going on in this country. What you may not know is that the expenses for job searching are actually tax deductible. You can also deduct moving expenses if you have to move more then 50 miles for a job.

Insurance Premiums
Everyone with a health insurance premium gets a deduction. However, self-employed individuals who are not covered by an employee plan get to deduct 100% of their health insurance premiums.

Donations to Charity
Most people know when you donate money to a charity or non-profit organization for charity it is tax deductible. But did you know that other, non-cash donations are tax deductible as well? Indeed, anything from toy drives to goodwill donations are tax deductible–just keep the receipt. 

Tax Preparation Expenses
Ironically, one of the most commonly missed deductions is for the fees and costs of filing your taxes. This includes e-filing, software, and even professional tax preparation fees. However, you can only deduct last year’s expenses, so make sure to save any receipts you get now for next year’s tax return.

Casualty Deductions
If hurricane Katrina or the Southern California fires affected you, you may qualify for a casualty deduction. In fact, any one who has been affected by any fire, hurricane, or serious flood may qualify. Check the IRS website for more details.

Qualifying Home Office Deductions
If you have a home office that you use as your primary office, you can get a reduction. This is an especially useful deduction for those trying to get their business off the ground and should not be overlooked.

Business Travel Expenses
There are multiple tax deduction possibilities for business travel. If you have a vehicle that you use primarily for business purposes, you may be able to deduct gasoline costs to and from business ventures. Other vehicle expenses may also be deductible as well. In addition to driving deductions, you may also be able to deduct expenses for other types of transportation and lodging when doing business.

State Sales Tax
You can deduct income taxes or state sales tax, depending on where you live. People who live in states that do not impose income taxes benefit from the sales tax deduction the most. While those living in states that do impose income taxes usually benefit more from the income tax deduction.

Filing taxes on their own

Filing taxes on their own
The economic downturn, low-cost tax software and disillusionment with tax preparation companies have increased do-it-yourself taxpayers.

Read more on USA Today

Tax Preparation Services

Get All Your Home Business Tax Deductions
In any small/home business you definitely have more tax advantages than if you were simply an “independent contractor” or “sole proprietor” claiming the income on your personal 1040 tax return. The tax advantages become substantial when you consider how you can improve the profitability of your home business by filing a separate Schedule C for your business income and declaring all of the deductions you are entitled to.
You may be missing some very important deductions. You must itemize your deductions for your home business operation on a separate schedule just as you would for your personal deductions. Knowing which deductions you are entitled to can save your home business hundreds of dollars a year.
Here is some background information on how your income tax amount is arrived at by the IRS.
The U.S. taxation code states that almost all income is subject to federal income tax. The way that you, as the owner of your home business, arrive at the final amount of income tax is as follows:
Gross Income – (All Expenses + Miscellaneous Deductions + Depreciation on Assets) = Taxable Income
Taxable Income x (Your Tax Rate) = Income tax for the fiscal year
Here is a quick definition of the terms in the above taxation equation:
Gross Income: The total of all income for the year after the cost of inventory has been accounted for.
Expenses: All costs of doing business during the fiscal tax year. Examples include payroll, materials, supplies, interest on business loans, etc. To find out if an expense qualifies as a legitimate business expense, consult your accountant or the IRS.
Depreciation: This is a way of spreading out the deductibility of an asset over a period of more than one year. This is done for assets like real estate, equipment and other assets with a long economic life. This method of taxation write-off has certain advantages. Be sure to talk to your accountant regarding proper depreciation rules. The IRS has different depreciation schedules for different business property. These rules are subject to change by Congress and the IRS.
Miscellaneous Deductions: This is an often misunderstood and overlooked way to save a lot of money on taxes. Remember that these types of expenses must be totaled up and declared on a separate schedule of your income tax forms. Always track your expenses and be sure to save at least one copy of every deduction. You will be asked for proof of every transaction that is declared as a deduction if you are audited by the IRS!
Here is a list of some of the most common business related expenses you can deduct from your income taxes:
1. Airfare
2. Auto Expenses
3. Books and Magazines
4. Educational Expenses
5. Home Office Space* + a portion of Utilities, Telephone, and Maintenance Costs
6. Office Furniture
7. Cleaning Expenses
8. Meals with Business Clients
9. Laundry Expenses (when traveling)
10. Advertising
11. Bank Fees and Interest
12. Licenses and Regulatory Fees
* If you own your home you must use the IRS depreciation rules to determine this deduction. If you rent, you may also deduct a portion of your rent.

Check IRS Publication 535 or contact me to schedule a consultation to find out if you can deduct any or all of the above.

As you can see, there are many deductions that are allowable for your home business. The best way to get more information on tax deductions and related information on income taxes is to go online to http://www.irs.gov. There you will find a helpful search engine containing thousands of government publications that you can research and print out if you need to.

Now you have a good idea of the deductions you are entitled to take. So do your research, keep track of your expenses and take all of the deductions you can for maximum profit every year.

Drew Miles Reviews Ways to Save on Your Taxes

Hi, my name is Drew Miles, and I would like to share with you some ways your business can save money on taxes every year, just by following some simple steps. It’s that “Wonderful” time of year again! You ask, “What time is it?” IT’S TAX TIME! When operating your own business most of us are always busy building the company, and it’s the little things that get overlooked every year. So remember, when you sit down to gather all the information for your tax accountant or bookkeeper to prepare your taxes this year, make sure you have checked off every deduction that you are allowed to take. It could save you A LOT of MONEY!

Most experienced small-business owners have an ongoing relationship with their tax specialist to simplify the tax filing process each year. Even so, some of the infrequently used deductions can easily be overlooked. The following is a list of business expenses that are often passed over in tax preparation season, and can serve to reduce your tax bill. Be sure to review all of your expenses and look for potential tax deductions you may have missed. Consult with your tax adviser when considering deducting any of the following items because limitations and special requirements may apply.

1. Advertising and printing of business materials.

2. Automobile expenses for business use, using either actual costs of repair and gas or the standard mileage deduction.

3. Business entertainment.

4. Business equipment and furnishings.

– Business safe deposit box fees
– Depreciation on business equipment
– Office supplies
– Software costs
– Telephone (cell phones), Internet, television and other communication used for business purposes
– Business gifts, provided they meeting IRS criteria

5. Business insurance premiums.

6. Costs of business books, periodicals or newspapers.

7. Donations the business gives to charities.

8. Dues or membership costs to professional organizations.

9. Education costs for self or employees, when business related.

10. Expenses when moving offices or other business facilities.

11. Fees and penalties.

– Relating to CDs, business checking, savings or money-market accounts
– Associated with retirement accounts for self and employees
– For credit bureaus, Better Business Bureaus, local associations, etc.
– Paid to employment agencies

12. Interest payments on business loans.

13. Janitorial, landscaping and maintenance costs.

14. Losses due to fire, windstorm, hail, flood or other natural disasters may be deductible.

15. Losses due to theft may be deductible.

16. Mortgage or lease payments.

17. Self-employed tax deductions.

– Individuals can deduct a percentage of their health insurance premiums paid during the year, both for themselves and for their dependents

– May deduct one-half of their self-employment tax

18. Shipping and postage.

19. Tax preparation fees, accounting fees, attorney fees, insurance consultation fees, etc.

20. Travel expenses.

– Hotels, airfare, meals and business entertainment while on the road
– Costs of passports for self and employees when traveling for business purposes
– Laundry costs when traveling for business
– Unpaid invoices or debts (i.e., uncollected debts).

21. Utilities for business facilities.

Pathfinder Business Strategies is offering consumers who visit their website a free tax savings special report & CD titled “Tax Secrets of the Rich”. For information about these tools visit http://www.taxsavingconcepts.com

The Top 10 Most Overlooked Deductions

Like most taxpayers, when filing your tax return you want to get the largest return amount possible. Most of us believe we are so thorough and that we are detecting every deduction possible that we qualify for. The truth is, many of us are missing out on several tax deductions. Below, you will learn about the ten most over looked tax deductions taxpayers commonly miss out on when they file taxes at tax time.  Read carefully about these deductions because chances are – you may be eligible and missing out on some of these deductions yourself.

1.      Charitable contributions paid out of your pocket: This may include ingredients that you purchased out of your own pocket in order to feed the needy or if you traveled somewhere to volunteer for a disaster relief situation.

2.       Child Care Credit: If you receive child care assistance through your place of employment this credit is easy to miss. You can receive up to five thousand dollars for child care that is reimbursed through your place of employment. Other child care programs can qualify for up to six thousand dollars in tax credit if your child care is not in a place of employment reimbursement program.

3.       Refinancing: If you have recently refinanced your home, you are most likely eligible to receive refinancing points. This deduction does require you to deduct the refinancing points over the entire life span of the loan. For instance, if you are financed for a twenty year loan then that means it is twenty dollars per year for each one thousand dollars that you have paid.

4.       Military Reserve Travel Costs: If you happen to be a member of the military reserve program or a member of the National Guard, you may be eligible to receive a deduction for traveling expenses. This can be used when you are required to travel to drills, other meetings or events. The requirements just state that you must travel more than one hundred miles in order to be eligible for this deduction and you must be at the destination over night.

5.       Moving to a new job: If you were required to move fifty miles or more in order to take a new job then you may be eligible for this deduction. If eligible, you can deduct the amount it cost to relocate and travel to the new destination. This also includes a cents-per-mile traveled amount. You may also deduct the amount of parking fees or other tolls.

6.       Student Loans: If you are a parent and you paid the interest on your child’s student loans you could also receive a tax deduction. The IRS views this as giving money to the dependent and the dependent pays on the loan. A child who isn’t claimed can qualify to deduct up to twenty five hundred dollars.

7.       College Tuition: If you helped pay tuition for yourself, spouse, or dependent you could be eligible to deduct up to four thousand dollars.

8.       Educators’ Expenses: If you are a teacher you may be eligible to deduct up to $250 dollars if you spent your own money in order to purchase classroom supplies or books.

9.       State Implemented Sales Tax: To receive this deduction, you must choose either a deduction of state income tax or state sales tax.

10.     Jury Duty: If you were summoned to jury duty and your place of employment paid you for that day, but required you to hand over your jury duty compensation to the company you may be eligible for this deduction.

If you exam your tax returns carefully, you may find you have missed a deduction, or maybe a few.  If you qualify for any of these tax deductions, make sure you take them.