5 tax breaks that could save you big
April 15th is quickly approaching. Now is the time to get ready to file your taxes. Whether you are expecting a huge return, or you are concerned about potentially owing the government for your yearly earnings, you may be eligible to utilize tax credits and potential breaks. We've collected a list of five common tax breaks you might want to consider using for the coming tax season.
Charitable Contributions
Don't forget to keep receipts for your charitable contributions. Everything from Goodwill donations, to monthly donations to the charity of your choice, count towards charitable contributions. While many contributions remain intact, there are some changes to the category for 2019. If you donated to a college or university, for example, and received a benefit in return, like tickets to a sporting event, you can no longer count the deduction.
Mortgage Interest
You can still deduct the interest you've paid towards your mortgage. You may use this tax break on a property up to $750,000, and home equity loans can be included in your total, as long as you can prove that you used the money to improve your property. To prove you have made changes to your property, keep invoices from contractors and receipts from supply stores.
Medical Expenses
If you've had a tough year in the health department, you may be able to reclaim some of your cash through tax breaks. If you've spent more than 7.5% of your gross income on medical expenses, you are eligible for a tax deduction.
Work Clothes (in certain circumstances)
The IRS makes allowances for individuals who have to purchase specific gear for their jobs. Individuals who have to buy specialty footwear, safety gear, or uniforms are eligible for tax deductions. Individuals who have to wear a suit on a daily basis; however, do not qualify for the same deductions. If you are in a field that requires safety equipment, save all receipts for your purchases throughout the year. An accountant can help you determine whether or not your work clothes qualify.
Student Loan Interest
Filers can save upwards of $500 a year if they have paid student loan interest in the last 12 months. If you have paid interest on your student loans during the 2018 calendar, you can deduct up to $2,500. You will need a 1098-E to claim the tax break. If you have paid more than $600 in interest, you will receive this form automatically, or you can request it from your lender.
Remember, not all of these credits will apply to every individual. If you have any questions or concerns about deductions that you qualify for, it is best to speak to an accountant. They are the best source of information regarding tax deductions.
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