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Do You Know Hidden Ways to Reduce Your Taxes?

By
Laura Adams, MBA,
January 20, 2011

 

Money Girl: Are There More Ways to Reduce Taxes?

Q. Kathleen Silver from Facebook wants to know if there are other ways, besides making 401(k) contributions and charitable donations, to reduce taxes if you don't own a home, have self-employment income, or have children.

A. Yes, here are five other potential tax deductions that you might be eligible to claim:

  1. Employee expenses: You can deduct unreimbursed expenses that are for your job or profession-such as travel, meals, seminars, supplies, uniforms, physical exams, dues for professional organizations, journal subscriptions, business use of your home (see Publication 587), and educational expenses (see Publication 970)-that exceed 2% of your adjusted gross income. See Form 2106 for more details.

  2. Tax preparation fees: You can deduct expenses you paid for the preparation of your tax return, including electronic filing fees and credit or debit card convenience fees.

  3. Casualty and theft losses: You can deduct part or all of any losses caused by theft, fire, storm, vandalism, corrosive drywall, and vehicle accidents. You may also be eligible to deduct money you lost due to the insolvency or bankruptcy of a non-federally insured financial institution. See Publication 547 for more information.

  4. Medical and dental expenses: You can deduct certain unreimbursed medical expenses-such as insurance premiums, medicine, doctor visits, medical exams, nursing help, hospital care, medical aids, eyeglasses, and travel-that exceed 7.5% of your adjusted gross income. For complete information see Publication 502.

  5. Educator expenses: If you're a teacher, you can deduct up to $250 for unreimbursed expenses for books, supplies, computer equipment, and software that you use in the classroom.

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