Taxes can feel overwhelming, and many people end up leaving money on the table simply because they’re unaware of all the deductions they qualify for. To help you save more of your hard-earned money, we’ve compiled a list of five common tax deductions that you might be missing. 1. Home Office Deduction If you’re self-employed or work from home, you may qualify for a home office deduction. This deduction allows you to claim a portion of your rent or mortgage, utilities, and maintenance costs if you use a dedicated space in your home exclusively for work. Be sure to keep records of your expenses to substantiate your claim. 2. Student Loan Interest If you’re paying off student loans, you may be eligible to deduct up to $2,500 of the interest paid during the year. This deduction applies even if you don’t itemize your taxes and is available to many borrowers based on their income levels. 3. Medical Expenses If your out-of-pocket medical expenses exceed 7.5% of your adjusted gross income, you may be able to deduct them. This includes costs for doctor visits, prescriptions, surgeries, and even certain travel expenses related to medical care. Remember to keep all your receipts and documentation. 4. Retirement Contributions Contributions to certain retirement accounts, like a traditional IRA or a 401(k), can lower your taxable income. For example, contributions to a traditional IRA may be deductible depending on your income and whether you’re covered by a retirement plan at work. Be sure to check the annual contribution limits to maximize this benefit. 5. Charitable Donations Donations to qualified charities, including cash contributions and the value of donated goods, are tax-deductible. Keep detailed records, including receipts and acknowledgment letters from the organizations, to ensure you can claim this deduction accurately. Final Thoughts Taking advantage of these deductions can make a significant difference in your tax bill. However, every situation is unique, so it’s a good idea to consult with a tax professional to ensure you’re maximizing your deductions and staying compliant with tax laws. Don’t leave money on the table—be proactive and keep track of your eligible expenses throughout the year! Discover the B&M Financial Management Services difference today, and let Theresa Todman and our expert team help you achieve financial excellence. Request your free consultation!
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January 2025
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