Tax returns are done for most US citizens. There are still millions of Americans and their accountants who are still working on their 2022 tax returns. ***
There are many deductions that filers forget or don’t even know are eligible. Billions of dollars are paid out by taxpayers that could have been saved. Your tax advisor is aware of these tax deductions as they are required to be updated on all new tax laws.
Here are some little-known expenses for your tax planning that may be tax-deductible:
1. Job Search Expenses: If you’re searching for a job in your current field, you may be able to deduct certain job search expenses, such as transportation costs, resume preparation, and employment agency fees. These deductions may be available even if you don’t get the job.
2. Professional Development Expenses: If you’re looking to improve your skills or education in your current field, you may be able to deduct the expenses associated with professional development courses, seminars, and conferences.
3. Jury paid. Most employers will pay employees’ salaries while they are serving on a jury but ask that they turn over their jury fees to the company. This income has to be reported as taxable income. If you gave that income to your employer, you could deduct the amount, so you aren’t taxed on that money.
4. Moving Expenses for Work: If you move for work-related reasons, you may be able to deduct certain moving expenses, such as transportation costs, storage expenses, and lodging costs. The distance between your new home and your new job must meet certain requirements, and there are other eligibility criteria to consider. If you’re an active-duty military member who is relocating, you can deduct these expenses as long as the government doesn’t reimburse you. The move must be permanent and ordered by the military. The deductions include gas, lodging, moving trucks, and shipping your cars and pets.
5. Home Office Expenses: If you work from home, you may be able to deduct certain home office expenses, such as utilities, internet expenses, and office equipment. The space must be used regularly and exclusively for work purposes to qualify for the deduction.
6. Investment Expenses: If you have investments, you may be able to deduct certain investment expenses, such as advisory fees, custodial fees, and other expenses related to managing your investments. If you have any mutual fund and stock dividends, they are automatically reinvested in extra shares, each reinvestment increases your tax basis in the stock refund or mutual fund. This reduces the amount of taxable capital when you sell your shares. 7. 7. Reinvested dividends which you subtract from the proceeds of sale to determine your gain means you will overpay your taxes.
8. State tax paid. If you owed taxes when you filed your 2021 state tax return in 2022, then you can include that amount with your state tax itemized deduction on your 2022 return. You may also include your state income taxes withheld from your paychecks or paid with quarterly estimated payments. Limited to a maximum of $10,000 per year.
These are just a few examples of little-known expenses that may be tax-deductible. However, there are many other deductions and credits available that can help reduce your tax bill. It’s important to do your tax planning with a qualified tax advisor to ensure that you are taking advantage of all the deductions and credits that you’re eligible for while also complying with all applicable tax laws and regulations.
A.K. Burton, PC, has been working with the IRS for our clients for many years. Our firm has experienced accountants who can help you plan your tax, file your tax returns, and represent you to the IRS. We do individual and business tax returns. Call us at (301) 365-1974 for a consultation.
We serve the Bethesda, Rockville, and Montgomery County, MD area.
*** You can find these deductions and other tax information on the IRS website.