The 5 Most Overlooked Tax Deductions

Tax season can be very stressful, however, you do not have to let it stress you out.  Since most people do not do their own taxes, they do not fully understand how easily the process can be. Unfortunately, if you do not educate yourself about taxes, then you can be overwhelmed with the requirements. Filing your taxes online can be very easy. With a few things in mind, you will be sure to complete them and get what you’re owed:

1. State sales tax 
State sales taxes are a definite write off on your taxes. A lot of people forget about sales tax being a write-off. If people don’t remember to write off their sales tax, then they will not get the largest return possible. Some states don’t even have an income tax. This is one of the most forgotten tax deductions.

2. Reinvested dividends
Reinvested dividends can save you a lot of money. Unfortunately, most taxpayers do not know that reinvested dividends will save them money. Mutual funds are a commonplace of the taxpayer’s dollar. Since so many investors take advantage of having mutual funds dividends reinvested automatically, their “tax basis” is raised. When a tax basis is raised, you pay lower taxes on your capital gains. 

3. Out-of-pocket charitable contributions
Out-of-pocket charitable contributions are easy to identify among your expenses for the year. The tax process is understanding the fact that you spend a good portion of money on charitable causes. Deducting out-of-pocket charitable contributions will also save you money. There are many different things that might cost you money while you help charitable causes.  Charitable causes may require you to drive. If you had to drive for a charitable cause last year, then you can expect $0.19 for every mile that you drove. 

4. Student loan interest 
Student loans require interest year by year. Since the government views a student loan as a valuable investment, they deduct the interest you pay on it from your taxes. A lot of people forget to take that out of their taxes. That can result in a lack of funds. If you remember to report your student loan costs, you will be rewarded with more money. Most people would like to take home the most amount of money they can every year, so it is very important to note the cost you may have acquired from student loans. Student loans are very popular among the population. 

5. Child and dependent care tax credit 
This is another element that people forget about. A tax credit is even better than a tax deduction, so this opportunity to put money in your pocket should be taken advantage of. A lot of people choose to have their bills taken care of through a program that they have with their employer. These programs usually reimburse the employee. Since this is such an easy process, people forget to report it on their taxes. By reporting the cost of children on your taxes, you will lower the amount of money that is going to be taxed.


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