Hidden Tax Breaks
- From 2008 to 2010, the federal government offered a $1,500 tax break for home owners who made their home more energy efficient by installing new windows, a new furnace, putting in insulation or installing a new air conditioner, according to Dan Shapley, writing for "The Daily Green" website. That tax break was slashed drastically in 2011 when it was reduced to $500. Check with the IRS to determine if your home improvement project qualifies for this tax break.
- People who volunteer to help out charitable organizations are not allowed any kind of tax deductions for what they perceive to be the value of their services. However, there are several kinds of deductions that volunteers can take on their taxes that they may not be aware of, according to John Suttle and colleagues., writing on the Nolo website. Those deductions include expenses associated with using a cellular or land-line phone for fundraising, hosting fundraising events and some car expenses such as oil, gas and parking fees.
- If you have a student you are putting through college and your annual adjusted gross income is less than $80,000 if you are single or less than $160,000 if you are married, then you qualify for the American Opportunity Credit. The maximum allowed tax break is $2,500 per year for each student you have in college. The break applies to the parents or the student, depending on which one is paying the tuition.
- When the economy is struggling and jobs are hard to find, people often become so elated when they find a job that they forget that their job hunting activities are tax deductible. While you are job hunting for a job in your current field, you should keep receipts for employment agency fees, copying resumes, postage and cleaning costs for your interview suit. The full list of job-hunting deductions can be found in IRS publication 539. These deductions do not apply if you are looking for your first job.
