Commonly Overlooked Tax Deductions Checklist

This tax season, here are the deductions to look out for—so you don't miss any opportunities to save money on your taxes.

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Tax season can be stressful for a number of reasons, especially having to pay the IRS whatever you owe them. But there is money in this for you too—you just have to know where to look for it. Sure, you might know the main tax deductions you are eligible for and claim every year, but there might be more for you to claim.

For instance, in 2021 the IRS announced that PPE bought to protect yourself from COVID is tax-deductible. "Items used for personal protection equipment, such as masks, hand sanitizer, and wipes, are deductible medical expenses," explains Kemberley Washington, CPA.

Claiming as many of the credits you're eligible for means more money in your pocket at the end of the day, and you could be missing out if you don't know what to look for. This checklist can help you keep track of credits you may qualify for, especially if you're doing your taxes yourself. Here are some commonly overlooked tax deductions to keep an eye out for this upcoming tax season.

Medical

Many medical expenses are potentially tax-deductible for those who qualify.

"When it comes to the medical expense deduction, if you can claim itemized deductions, meaning your deductions for things like home mortgage interest and property taxes are more than the standard deduction ($12,550 if single, $25,100 if married filing jointly), then you can claim your medical expenses that are more than 7.5 percent of your adjusted gross income," explains Lisa Greene-Lewis, CPA and tax expert at TurboTax.

  • Health insurance premiums

    For self-employed people, medical insurance premiums are tax-deductible, even for those who can't claim itemized deductions.

  • PPE

    Masks, hand sanitizer, sanitizing wipes

  • Transportation expenses for doctor's visits

    16 cents per mile can be claimed for trips to medical facilities or doctors' offices.

  • Nursing home medical expenses
  • Acupuncture, chiropractor
  • Hearing aids, orthopedic shoes, eyeglasses, contact lenses, laser surgery
  • Equipment for disabled individuals

    Wheelchairs, crutches, etc.

  • Alcohol and drug addiction programs and smoking cessation programs
  • Nurses' fees
  • Weight-loss programs prescribed by a doctor

Business

Don't overlook these business-related tax deductions—especially if you're self-employed.

"Self-employed [people] often are hesitant and overlook deductions for their business," says Greene-Lewis. As long as the expenses are directly related to your business, you should be able to claim tax credits for things such as your home office, utilities, and gas mileage.

Similarly, if you use a credit card for your business, you can deduct the interest on these cards for qualified business expenses, says Washington.

  • Education expenses to maintain or improve job skills
  • Credit card interest for qualified business expenses
  • Job-related professional journals and newspapers
  • Required uniforms
  • Union dues
  • Employment agency fees or commissions
  • Home office expenses (if you work from home)

    You can deduct part of your home expenses such as mortgage interest, property taxes, rent, and utilities based on square footage of your office space.

  • Car expenses

    If you use your car for your business, you can either deduct 56 cents per mile or the actual expense based on how much you use it for business.

  • Expenses for job-seeking in your current field
  • Reservist and National Guard overnight-travel expenses
  • Cleaning and laundering services while traveling for business
  • Cell phones required for business

Home

If you're a homeowner, keep an eye out for deductions you qualify for beyond home mortgage interest. "Many may know about the deduction for home mortgage interest, but don't forget that you can deduct points you paid to secure your loan," says Greene-Lewis.

"Some overlooked tax deductions for your home include mortgage interest, home equity loan interest, property taxes, and medically necessary home improvements," explains Washington.

  • Commissions

    Commissions for the sale of your home, or rental management if you rent it out

  • Moving expenses
  • Personal property taxes

    On cars, boats, etc.

  • Casualty and theft losses
  • Home improvements that are medically necessary
  • Housekeeping

    Or other home services needed for a qualifying dependent during your work hours.

Charitable

Under the American Rescue Plan, if you claim the standard deduction, you can now claim up to $300 for cash donations—$600 if you're married and filing jointly.

  • Donated clothing or other goods

    Note the estimated value (see Goodwill's Valuation Guide) on the receipt.

  • Mileage incurred while performing charitable activities

    You can claim 14 cents per mile if you're volunteering for a 501(c)(3) organization.

  • Volunteer costs

    Cost of meals, accommodations, public transportation, and parking when volunteer work sends you far from home—if you pay for them out of your own pocket.

Educational

Are you a student or a teacher? This one is for you.

"As a grade K-12 educator, including counselors, principals, and aides, you may be able to deduct $250 for unreimbursed expenses (books, supplies, equipment, etc.) you incur during the school year," says Washington.

If you're a student (or a parent with a college-going child), you could get tax credit for college expenses. "You may be able to claim the American Opportunity Tax Credit for up to $2,500 per student for the first four years of college expenses," explains Greene-Lewis. In addition to tuition and fees, books and supplies can be deducted as well. Note: The student has to be claimed as a dependent on their parents' taxes in order for the parents to claim.

  • Lifetime Learning credits

    A type of federal financial aid for college tuition that gives tax credit instead of tuition payment, and applies to courses that help gain or improve job skills, too.

  • School-related expenses

    If you paid for them as a K-12 educator and were not reimbursed (books, supplies, equipment).

  • American Opportunity Tax Credit for college expenses
  • Student loan interest

Finances

Did you know you can get a tax credit just for investing in your 401K or IRA? "The IRS reports that one out of five people miss the credit—but it can be worth up to $2,000 married filing jointly or up to $1,000 single," says Greene-Lewis.

You can also get a bad debt deduction, if someone owes you a valid debt. "You can deduct a nonbusiness bad debt if you tried to get your money back," explains Washington. These are bad debts that are not directly related to your business or profession.

  • Investment-related expenses
  • Refinancing points on a mortgage
  • Accounting or legal fees involved with taxes
  • Cost of safe deposit box

    If used for investments or business

  • Penalty on early withdrawal of savings
  • Bad debt deduction
  • Savers credit for investing in your 401k or IRA
  • Alimony

Other

If you were eligible for the third stimulus check, but didn't receive the full amount, you can claim more stimulus money as a recovery rebate credit when you file your taxes. This also applies if you had a baby in 2021.

  • Care provided for disabled children or spouse

    (Child and Dependent Care Credit)

  • Clean fuel credit

    For purchase of hybrid car.

  • Jury duty pay

    If reimbursed to employer.

  • Some gambling losses
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