Life Lessons: Tax tips and tricks
Time to start planning for next year
Now that we've all finished our taxes, financial experts say this is the time to start planning for next year.
Tax preparers say when it comes to your taxes, a little legwork can go a long way. If you don't itemize deductions or you overlook some, you can end up paying too much money when you file.
In Debbie Kutzavitch's home office, you'll find folders, papers, and receipts are all neatly stacked. Kutzavitch is always organized, but especially at tax-time she believes in following a plan.
But tax preparers say sometimes, no matter how prepared you are, there's something you've overlooked. Experts say the u-s tax code is overwhelming and changes almost daily. Paula Rummell, is a CPA and Tax Senior Manager with Horovitz, Rudoy, and Roteman says it's over 70-thousand pages in She adds, "If you fail to check your itemized deductions and just take the standard, you might be leaving money on the table."
She says medical costs are tax deductible. your health insurance premiums, dental care, glasses, counseling, and therapy all count. Also, you can write off miles driven to medical appointments.
"They are deductible to the extent they exceed a certain threshold, and that percentage is seven and a half percent of your adjustable gross income," says Rummell.
Education costs are often overlooked. Parents paying for college can take a tuition and fee deduction of up to four-thousand dollars. Even grad students can earn a break with the lifetime learning credit. That adds up to two-thousand dollars each additional year of college. Hunting for a job? You can claim the expense.
Experts say if you loaned someone money and don't get repaid, you could qualify for a non business bad debt tax deduction.
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