5 Most Commonly Forgotten Tax Deductions

commonly forgotten tax deductions

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The tax filing season is fast approaching and everyone is scrambling to gather their W-2’s, receipts, IRS forms and documentation. As a result, people tend to forget to include these commonly forgotten tax deductions or credits that could mean huge savings or a bigger refund.

In the midst of the hustle to prepare for tax season, 1-800-Charity Cars, conductors of the nation’s largest car/vehicle donation distribution program, brings awareness to the following list of the most commonly forgotten tax deductions and credits:

Dependent Care

While a majority of taxpayers are aware of the tax credits available for children, many do not realize that the Dependent Care Credit includes any spouse or dependents who are in your household for at least 8 hours a day and are physically or mentally incapable of caring for themselves. These commonly forgotten tax deductions can include a parent you may be caring for, whom you can claim an annual expense benefit of up to $3,000.

Energy Efficient Improvements To Your Home

If you have completed any energy efficient home improvements, there are two tax credits that you may be interested in:

  1. The Non-Business Energy Property Credit allows you to claim up to 10% the cost of new windows, doors or a roof. There are some limitations and caps set by the IRS, so you will want to investigate what the limitations are for your specific situation.
  2. The Residential Energy Efficient Property Credit, which is available through 2016, is a credit that permits you to write off 30% of your costs for the installation of alternative energy efficient equipment in your home. This would include items such as wind turbines or solar water heaters. There are no limits set on the tax credits you can receive for this.

Losses Due To Disasters, Theft, or Casualty

If you reside in an area that was declared a federal disaster area, you are automatically eligible to claim losses. Others who have losses that resulted from tornadoes, hurricanes, or even thefts may be able to claim certain losses on their taxes. There are some restrictions set forth; for example, if insurance reimbursed you then you can only claim a difference in the reimbursement versus the actual value.

Interest On Student Loans Paid By Parents

If you cannot be claimed as a dependent and your parents helped pay on your student loan, the IRS considers the amount your parents paid as a gift you used to pay a debt and will allow you to deduct up to $2500.

Out Of Pocket Expenses in Charitable Giving/Services

Many times people forget or just do not know they can claim out of pocket expenses related to their charitable giving and volunteer services to qualified organizations. This can include such things as 14 cents per mile for travel in your personal vehicle, parking and toll fees and air, train or bus fares. If a uniform is required that is not suitable for everyday wear, you can also deduct for the cost and cleaning of those uniforms.

Take the time to visit the Internal Revenue Service website at http://www.irs.gov and look through all the tax credits and deductions available to you before you get started on your income tax return. Taking the extra time to investigate can ensure you take advantage of every possible deduction or credit you are eligible for. In the end, it could reduce your debt to the Internal Revenue Service or increase your refund by avoiding these commonly forgotten tax deductions. If you find yourself nearing the tax deadline, check out this list of Last Minute Tax Tips.

We hope you can take advantage of these commonly forgotten tax deductions. If you’re looking to get started on your charitable giving for 2014, you can start now by making a monetary donation or car donation to 1-800-Charity Cars to help change the lives of struggling families. We accept all types of vehicles throughout the United States and you will receive a full “fair market value” vehicle donation tax deduction, if we can provide your vehicle to a family. Fill out our quick online donation form or utilize our online donation services using JustGive or PayPal at www.800charitycars.org or call 1-800-242-7489 and make a donation today!