If you haven’t yet filed your return, just in time for Tax Day (which is ten days away), here are some tax loopholes you can take advantage of:
- Individual Retirement Account (IRA) Contributions.
If you have contributed money into a traditional IRA, you can deduct that contribution against your taxable income. This deduction is only applicable to a traditional IRA, not a Roth IRA, but you are able to take this deduction up until Tax Day.
- Business Expenses or Work-Related Expenses. Keep in mind that these are expenses that have not been reimbursed to you by your employer. Depending on the nature of your work, these could be ordinary or necessary expenses. The Internal Revenue Service (IRS) has more information on their website.
- Medical Expenses. These are medical expenses on your state taxes. While there are limits on medical expenses for federal taxes (7.5 percent), there are no limits at the state level.
- Jury Duty Pay. Jury duty pay is considered taxable income except if you were still receiving a salary while on jury duty. You can deduct the amount of jury duty pay you received if you were also receiving a salary while out of work to serve on a jury and had to turn your jury duty pay over to your employer.
- Charitable Deductions for Personal Expenses. According to the IRS, you can deduct personal expenses that you incurred while volunteering with a charitable organization. IRS Publication 526 has more detailed information on out-of-pocket expenses in giving services.
- Saver’s Credit. We’ve written about the Saver’s Credit previously, but to recap, if you meet certain criteria (you’re married and you earned less than $58,000 last year), you can qualify for an additional deduction by investing in a retirement plan, such as defined benefit plans and defined contribution plans.