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Common Tax Deductions You Might Not Know About

Tax season can be a stressful time for everyone, but finding out you could have saved money on your annual tax bill is even worse. 

To avoid this, understanding what tax deductions you can claim is essential. While some tax deductions are well-known, like charitable donations and mortgage interest, there are several others that people may not know about. 

With this in mind, we’ve put together a list of common tax deductions that you may not have realized you’re eligible for.

Job Search Expenses

Are you currently on the hunt for a new job in the same field that you’re already working in? Then you may be eligible to claim job search expenses on your tax return. This tax deduction includes expenses like resume preparation and printing, employment agency fees, and even travel expenses related to job interviews; however, there are certain limitations to claiming these expenses.

Student Loan Interest

If you or someone in your family is paying off a student loan, then you might be eligible for the student loan interest deduction. Even if you don’t itemize your deductions, you can claim up to $2,500 in interest paid on a qualified student loan on your tax return. However, only the interest paid during the tax year is deductible and only for qualified student loan debt, such as loans for higher education, taken out for you, your spouse, or a dependent.

Moving Expenses

Another deduction that you might not be familiar with is moving expenses. If you’re moving because you’ve landed a new job that’s more than 50 miles further from your current home than your old job was, then you may be able to claim moving expenses on your tax return. These expenses include things like the cost of hiring a moving truck, travel expenses, and even the cost of storing your belongings in a facility if necessary.

Medical Expenses

Many people are aware of the medical expenses deduction, but what they don’t know is what it can include. Beyond doctor and hospital expenses, this deduction includes things like the cost of prescription drugs, therapeutic devices, and health aids like hearing aids and glasses. However, to qualify for a medical expense deduction, your expenses need to exceed a certain percentage of your adjusted gross income (AGI), which is typically 7.5% but varies depending on your age and other factors.

Home Office Expenses

With the pandemic causing many people to work from home, the home office deduction has become even more relevant this year. If you use a portion of your home exclusively for business purposes, then you may be able to claim deductions for expenses related to it. This could include things like rent, utilities, insurance, and even office equipment. However, there are strict rules surrounding what qualifies, so it’s essential to double-check the criteria.

While tax season may seem daunting, knowing the tax deductions you’re eligible for can make it more manageable. By keeping track of expenses throughout the year, you could be saving a significant amount of money. 

From job search expenses to medical costs, there are a variety of deductions available that you may not have previously known about. If you’re unsure about what you can claim, enlisting the help of a tax expert could be beneficial. 

Don’t leave money on the table, check out the deductions you may have missed!

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