Using the 1040EZ form can be the easiest way to file your taxes and many people elect to use this form, but they are missing out on standard income tax deductions that can give them a much larger income tax return. Read on to see what the usual income tax deductions are and see if you are claiming all of them. When you are ready to file your taxes, check out the link at the bottom to see how you can get your taxes filed for free.
If you decide to skip all the standard income tax deductions and file a 1040EZ tax return, you will be given a standard deduction based on your filing status. This is the amount that gets deducted from your income before determining how much tax you should have paid. Without a lot of deductions like charitable contributions or mortgage interest, this is probably the way to go, but if you have deductions, you could be costing yourself tons of money.
There are tons of standard income tax deductions you can claim, especially if you have a small business, but following are the deductions most people can take. A deduction for each member of your household is one of the first things you deduct. For each person you get to deduct a certain amount from your income. The next deduction most people can take is mortgage interest. If you own your own home, the amount of money you pay every month on interest can be deducted from your income. All your charitable contributions are tax deductible and most people donate to charity of some sorts. That means that all the money you donate to your church every Sunday reduces the amount of taxes you have to pay. Student loans are another common source of income tax deductions. You are allowed to deduct the interest portion of your student loans. Other deductions that are less common include medical expenses and expenses related to child care, but you should really consult a tax professional if you plan to go beyond the usual deductions.
Hopefully this quick list of income tax deductions will help you identify all the things you can deduct from your income to reduce the amount of money you owe the government.
Please note that I am not a professional tax accountant. I have been doing my own taxes by myself or with the help of a tax professional for 20 years so I know a few things, but I cannot offer you legal advice.
I recommend automated software because it is very good at reminding you of things that you can legally deduct, but won’t let you accidentally do things that will get you in trouble. If you have a complex return, you really should seek a tax professional as spending a little extra money is better than big fines if you get audited.
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