Keep in mind that the deadline for taxpayers to submit their yearly returns is April 18.
The filing deadline was moved to April 18 because Tax Day, which is traditionally April 15, falls on a Saturday and there is a holiday in Washington, D.C. on the following Monday.
The Federal Revenue Service had handled more than 101 million returns as of April 7. Taxpayers are receiving an average return of $2,878, down from $3,175 at the same period last year.
Here are some reminders of frequently overlooked items that might be deductible if you’re rushing to finish your taxes by Tuesday at midnight so you don’t forget them.
While itemising your deductions, bear in mind:
You may be entitled to deduct costs you paid for medical and dental care for yourself, your spouse, and your dependents if you itemise your deductions on Schedule A. This also applies to health insurance premiums. Only the portion of your total medical expenses, though, that exceed 7.5% of your adjusted gross income is allowable as a deduction. Fees paid to doctors, dentists, surgeons, chiropractors, psychiatrists, psychologists, and other non-traditional medical practitioners are among the things you can write off, along with prescription medications, dentures, reading or prescription glasses, contacts, hearing aids, crutches, wheelchairs, and more.
What are the uses of Forms 8962 and 1095-A?
If you purchased health insurance through the Marketplace, you must submit Form 8962 along with your tax return. To assist some people with the expense of health insurance, the Affordable Care Act contains a special Premium Tax Credit, and Form 8962 is utilised with your Form 1095- You can discover whether you qualify for the tax credit and, if so, how much you are entitled to by consulting a Marketplace health insurance statement. The IRS may reject your return for having insufficient information if you fail to file this form, which will delay your refund.
You may use the tax credit if you are eligible to do so to:
either lower your monthly insurance premiums or receive a tax deduction when filing your income tax return. You will pay less each month for health insurance if you select this option since the government will pay your insurer money over the course of the year.
Lifelong Learning Credit and the American Opportunity Tax Credit
There are two tax credits available for college tuition and education costs for single filers with incomes up to $90,000 MAGI or $180,000 for joint filers: the American Opportunity Tax Credit (AOTC) and the Lifelong Learning Credit (LLC).
The AOTC offers a credit of up to $2,500 for as many as four tax years per qualified student. The student must be enrolled at least half-time for at least one academic term starting in 2022 and be working towards a degree or another recognised educational certification.
LLC provides a credit for one or more courses worth up to $2,000 each return for an indefinite number of years even though no degree is being worked towards.
tax deduction for SALT
Taxes paid locally, including property taxes, are only deductible up to a maximum of $10,000 ($5,000 if you’re married and filing separately) if you itemise your deductions. Be aware that the deduction is the sum of a variety of taxes, including property taxes as well as state and municipal income and sales taxes.
Crowdfunding
Contributions given to a personal GoFundMe campaign rather than a charity campaign are typically seen as personal gifts and may not always be tax deductible. GoFundMe stated that no tax receipts will be provided for this.
But, according to GoFundMe, donations made to charity fundraisers on the website are sure to be tax-deductible in the United States, the United Kingdom, Canada, Ireland, and Australia and will immediately obtain tax receipts from the website’s charity partner, PayPal Giving Fund. The tax-deductible receipt will still be provided to donors from other nations, but they must validate their tax-deductible status with their home country’s tax office. The selected charity receives the contributions made to these fundraisers from PayPal Giving Fund, a non-profit organisation.
(If you received funds from GoFundMe or another crowdfunding platform, your payment processor might issue you a 1099-K if the sum exceeds specified reporting criteria. The IRS may require that you record this income.)
