If It's Free, It's For Me - Free Overlooked Tax Resources
May 21, 2020
Entering this new climate of uncertainty - amongst tax season no less - we have been struggling to complete our taxes in a prompt fashion, while also enduring this new work environment.
If you haven't already taken advantage of the tax extension - make sure you do if you have found yourself in a dilemma when it comes to completing your 2019 taxes. Businesses are also able to take advantage of this extension!
This is a free resource to use in this current state of being, and make sure when you complete your taxes you don't overpay by overlooking a few of these tax deductions:
1. Out-of-pocket charitable contributions
It's hard to overlook the big charitable gifts you made during the year via check or payroll deduction. But make sure you don't forget the little things too, as they can quickly add up and you can write off out-of-pocket costs you incur while doing good deeds.
Donations you make to qualified nonprofits and charitable associations fall into this category, allotting for a dollar amount of donated goods!
2. Student loan interest paid by you or someone else
In the past, if a parent or someone else paid back a student loan incurred by a student, no one got a tax break. To receive a deduction, the law said that you had to be both liable for the debt and actually pay it yourself. But now there's an exception!
If you are a student who is NOT claimed as a dependent, you can qualify to deduct up to $2,500 of student loan interest paid by you or someone else. The next time you receive a 1098-E form from your school, save it for tax season - you'll be glad you did.
3. State tax you paid last spring
Did you owe taxes when you filed your 2018 state tax return in 2019? Then remember to include that amount with your state tax itemized deduction on your 2019 return, along with state income taxes withheld from your paychecks or paid via quarterly estimated payments.
4. State sales tax
This write-off only makes sense primarily for those who live in states that do not impose an income tax. Here's looking at you, Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming. Why is this a factor?
You must choose between deducting state and local income taxes or state and local sales taxes. For most citizens of income-taxing states, the state and local income tax deduction is usually the better choice.
While tax season can get under most people's skin - there are many free resources on the web that can aid in your filing for 2019. Not to mention, the countless CPA's that you can contact to better help you and offer their inside knowledge and services to help make your tax season more efficient!