What To Watch For This Tax Season

The tax season is the time of year when many families and individuals have to figure out what they owe in taxes or imagine what they are going to get back in a refund. However, there are some items that families and individuals have to look at to make sure that all of the bases are covered before a tax return is filed.

Each of these items are things for people over 50 to look out for when they are preparing their tax returns. There are considerations for people over 50 that are unique to them as parents and people with greater earning potential.

The House

Many people over 50 own their home and have for many years. However, house payments usually contain interest payments that can be used as deductions on a tax return. If the individual is going to make their payments faithfully, they should also use their interest payments to get a write-off on their return.

College

Many parents over 50 are paying for their children to go to college. These loans also have interest payments that can be written off just as they are with a home loan. However, the stressed parent of a college student may forget to deduct the interest payments that they have made while their child is still in college.

Dependents

Parents over 50 may also have dependents that they can name on their income tax return. Having dependent children who live at home at least for part of the year can help to reduce an older parent's tax liability simply because the dependent helps to reduce the tax bracket that the individual falls under. Even if the child is an adult, they may be considered a dependent child who can be claimed on an income tax return.

Capital Gains

Many people who have been earning money for quite a long time may also have a long list of investments that they are juggling to produce income or as part of the retirement planning process. However, every dollar that is earned from the dividends on these holdings or from the sale of these holdings must be reported. Many people may forget these things and fail to report them on their income tax return. Failing to report these items on a tax return could cause the individual to be audited now or in the future.

Side Businesses

Many people who work for a living also have side businesses where they own properties and rent to tenants or do work on the side to earn extra cash. These side businesses all produce income meant to finance the family, but this money has to be reported on income tax returns to avoid the ire of the government.

Every person who does a little bit of work on the side must be certain that they are not only calculating how much money they are making but also notating the deductions they can take for that business.

Mileage reports, business expenses from internet connections to office supplies and even electronic equipment can be used as deductions for these side businesses. The only way the side business will be worth it at the end of the year is if the individual deducts all of the items they use for the business.

When looking at home to finance the family activities for the year as well as preparing for tax returns at the end of the year, the family can put together a tax return that accounts for interest payments, dependent children, side businesses and investment income. Wit all of these factors in play, any family can feel safe during the tax season.

Author Bio
Joshua Turner is a writer who creates informative articles in relation to business. In this article, he offers tax tips to individuals and aims to encourage further study with a masters degree in accounting.

Holiday Charitable Giving: Tips to Help You Do It Merry and Right

Beyond the obvious tax benefits and general warm feelings that end-of-the-year charitable giving brings to those who participate in it, donating money or goods to organizations whose mission is to serve those who are in need does a necessary good in the broader society. However, not all giving is as straightforward as it may seem, and if it isn’t done well, it can bring out the Scrooge in even the most giving of hearts.

Charitable giving—like most things—contains a sweet spot. For some givers, it’s a concern over tax breaks; for others, it’s a desire to make sure they stretch their dollar as far as it can go so the greatest good is accomplished. Whatever your preoccupation, these tips will help ensure your donations this holiday season are merry, bright, maximized and completely deductible. 

The IRS

Most people know the majority of charities in the United States are nonprofits with a 501(c)(3) designation, which is the designation that means your donations to them are tax deductible. Beyond that, the details get murky for most people. Here are few other tips to keep you safe from Uncle Sam when you play Saint Nick this season:

• Donations are deductible during the calendar year they are made in, which means the day you drop the check in the mail or charge a gift to your credit card.
• Limits on how much you can claim and still receive a tax break only come into play when you reach above 20 percent of your income—but you can still give away as much as you want.
• If you volunteer, you can’t deduct the hours you work, but you can claim any expenses that you paid to do the volunteering, like gas mileage.
• The IRS also has a list of recommendations on getting tax breaks from charitable giving, which is great, because they’re the experts.
• Keep Records

While all charitable organizations should send you receipts for any giving you do, it’s always still a good idea to keep your own records. After all, nobody’s perfect, right? So, if you’re giving money via a text message, you’ll need to keep a copy of the phone bill the gift was allocated to. If you write a check, write “Donation” in the memo line, andfor all your giving, keep a record of the following:

• The name of the organization
• The date of the gift
• The means of giving (i.e. check, credit card, donated goods, etc.)
• The amount of the gift

Get Your Employer to Match Your Donation

Even if you don’t work for a large company or corporation—but especially if you do—check with your boss or manager to see about a matching grant. Businesses are interested in tax breaks and in assisting their communities. If you can guide them to a charity that does both, you just made your donation—and your employer’s reputation—that much better.
Do a Background Check

Nobody wants to doubt a charity’s intentions, but it can still be a good idea to check with a site like Charity Navigator to make sure the organization you’re giving your money to is not just legitimate, but that it also handles its affairs well. An independent charity evaluator, Charity Navigator (and other sites like it) works to give donors information about almost 7,000 charities, and they gather information specifically related to a charity’s financial health and its accountability and transparency practices. You can find out how much of the money you give will go to the needs the charity is addressing, as well as how much of your gift will go to administrative work and salaries. Site that evaluate nonprofits take a lot of the unknowns and guesswork out of the giving equation, which puts donors at ease. It also helps good charities reap the rewards of being good stewards, while training a watchful eye in the direction of groups that aren’t as efficient or transparent as they could be—which provides good incentive for those groups to try harder.

Because a hefty portion of most charities’ annual operating budget comes in just as the ball drops on Times Square, year-end giving is their lifeblood. Whether you’re an unrepentant do-gooder or a secret softie who wants a tax break, follow these tips and you’ll ensure your gifts go as far as they can—for the organizations and your tax bill.

Image by imagerymajestic from FreeDigitalPhotos.net

About the Author:Arnold Cooper is a blogger who previously worked as an accountant. He suggests considering charities such as Boat Angel for your holiday giving this season.

Tax Deductions in an SMSF: Quick Tips for Contributions and Earnings

One of the most popular reasons to open a Self-Managed Superannuation Fund, or SMSF, is the tax benefits it affords. SMSFs are tax-effective vehicles in part because certain contributions and earnings linked to these smaller super funds receive special before-tax, or "concessional," treatment. Yet, SMSF trustees are warily eyeing the ATO as it sweeps trustee roles for rule-breakers.

In this climate, it's very important to ensure all self-managed super funds comply with the latest regulations. It could mean the difference between a tax rate of 45% instead of 15%. Compliance also frees the SMSF to deduct certain expenses. Let's take a look at the current state of allowable deductions, from life insurance premiums to administrative fees, to discover how the bills can be legally reduced within the framework of a Self-Managed Super Fund.

Rules of Personal Contributions

One way to trigger deductions and maximize retirement savings is by making concessional personal contributions to an SMSF. For self-employed or partially retired workers, personal contributions to an SMSF are deductible on individual returns. Note the cap on how much a worker can contribute in a year. This cap indirectly limits the amount of available deduction.

However, it is possible to exceed the concessional cap—currently set at A$25,000—but doing so means stepping back and paying the government more for "excessive contributions." This would cancel out any deductibility gains and should be avoided.

Of course, it is not possible to claim personal contributions whose sum is greater than the taxable amount. If, for instance, John's income is A$50,000 and he makes A$8,000 in personal contributions to his super fund, how much of his contributions can actually be deducted? A$50,000; deductions do not translate into income 'credits.' In the best-case scenario, the deduction reduces the taxable amount to zero.

Funding Assessable Income

Beyond personal contributions, members can generally deduct those expenses that directly contribute to the fund's assessable income. Normally, a Self-Managed Superannuation Fund incurs some administrative and actuarial costs in the course of sustaining the trust on behalf of the members, and these—including the ATO's levy—are certainly deductible. Some insurance expenses, namely death and disability premiums, may qualify as well.




A lesser-known deduction is the cost of paying out on a life insurance policy if one or more members passes away. This is called the Future Services Benefit Deduction. In some situations, deducting this expense is a smart move that could end up saving the surviving members thousands. It could even prevent them from having to pay taxes on fund earnings for several years.

Earnings from Fund-Held Assets

Tax deductions are also available to offset certain fund expenditures and investments. The most popular deduction depends on the tax-free treatment of earnings from a super pension's assets. Any income or capital gains made on the investments of these assets can be counted against the SMSF's income.

The tax office says over 85% of SMSF deductions in 2010 were based on this rule. It is the main attraction for many retirees who now rely on self-management for maximizing their investments. People who claim these deductions, however, must remember to continue making minimum pension payments every year. It's what qualifies super investment expenses and earnings for tax-deductibility.

This strategy could be profitably deployed by a retired couple, for instance, that wants to combine both taxable and tax-exempt funds into their pension. Read this tax saving through SMSF case study, where SMSF Perth put together a strategy to design a largely tax-free inheritance for their children, while taking advantage of concessional deductions for the taxed money they actually lived on.

Author Bio: Greg Major, Director, Blueprint Wealth:Greg Major, Director of Blueprint Wealth which specialises in Self-Managed Super Funds in Perth, has over fifteen years’ experience in a variety of Financial Services roles within the Banking Sector in Australia. Most recently Executive Vice President with ABN AMRO, Greg has extensive experience across all major wholesale banking and finance fields, including derivatives and risk management, capital markets and structured finance, and balance sheet, liquidity and capital management with experience working across Europe and Asia.

Top 10 Tax Tips For The Self-Employed

(Photo credit: patrick h. lauke)

Self-employment is a tough road to go down, but luckily there are a few things that you can benefit from. Self-employed individuals will have a different tax status to those who are employed by someone else. As a result, you are going to want to take a look at your taxes and see what you can do when it comes to making the most out of your situation.

Determine Your Net Income

Your net income is the income that you receive after all of your business expenses have been deducted. This can be done after a year of working to determine what you are most likely to earn.

Keep a Record

Make sure to keep a record of everything that you earn. Knowing how much you earned every week or month will allow you to figure out the proper rate at which you will be taxed.

Calculate Estimated Tax

Try to determine what percentage of your tax you are going to have to pay. Deduct this from your net income and you will have an idea of how much you owe.

Expenses for the Home Office

If you have a home office, then you will be able to make it a tax-deductible business expense. Remember that you are not able to deduct more than your net business profit.

Get an Accountant

Having someone to take a look over all of your expenses is a great thing. On top of this, you can also deduct what you pay from your accountant as a business expense.

Remember to Report

Making over $600 from a client means that you are going to have to report it to the IRS. When this happens, your client is going to give you a 1099-Misc.

Set Up a Separate Account

Get a separate account where you will be able to put all of your estimated taxes in. This is much easier than scraping for the money at the end of the year.

Keep a Track of All Business Expenses

Business expenses can include anything that you use in order to carry out your business. These can include your computer, your desk, your phone and your Internet connection. Make sure to keep a track of everything in this regard.

Remember to Pay Quarterly

You do not pay your taxes on a yearly basis. Instead, you pay every quarter of the year. This means you have to make sure that you have everything organized.

Keep Everything Together

Get files for all of the necessary expenses and tax records that you are going to need. Organizing all of this properly will ensure that you know what is going on when the time comes to pay.

Being self-employed can be difficult for many reasons, but it is always a good idea to keep on top of your tax returns. There are a number of things that you can also do for tax relief, so make sure to take advantage of them if you can. This way, you can ensure that you make the most out of being self-employed.

If you are interested in more tax relief tips, the author recommends you visit OptimaTaxRelief.com

Handy Tips on Effective Tax Returns

taxes (Photo credit: 401(K) 2012)

After the back to back financial slumps in and after the year 2008, the structure of the world economy has greatly changed. There are millions all over the globe, who do not have a proper credit history. Hence it becomes a difficult task for them to get a loan. Besides getting the loan, one also needs to make sure that they manage their taxes in a proper way. In this article we will provide the correct tax planning tips that will help one to manage their taxes correctly.

Possessing the correct information on Taxes

Having the correct knowledge of the tax that you need to pay is the most important thing. There are various kinds of tax that one needs to pay such as local tax, federal tax, income tax and others. Often it is found that one finds it difficult to understand the nature of the tax and how much exactly they should pay. In such cases it is a beer idea to hire a professional who has a fair idea in tax returns. Such professional will also be able to help you to find ways to save on your taxes. There are numerous ways in which one can save on their taxes using legal methods.

Maintaining a Record of the transactions

Keeping a record of the tax payable is an effective way of managing your tax payments. That way you will not lose track of the amount of tax that you need to pay and the time at which you need to pay it. Many a times it is found that individuals inadvertently skip their tax and eventually end up paying more. Maintaining a folder or a file will help one to keep abreast of the tax returns that they need to make.

Hiring a Professional Tax Consultant

Hiring a professional tax consultant is of utmost importance. The entire scope of tax returns is huge and it is virtually impossible for an individual to get a proper idea of it. There are numerous ways in which one can benefit by hiring a tax consultant. The most important benefit of hiring professionals is that, they will be able to help you in saving money on your tax. Moreover they will also be able help you to easy ways of tax return.  Hence resorting to the help of a professional is certainly a great way to manage your finances.

On a Concluding note

On a concluding note it can be said that in order to manage your finances in the best possible way, you need to keep in mind all the above mentioned points. A recent study has shown that many individuals lose thousands in penalties for not paying their tax on time. Hence you should consider hiring a consultant to manage all the aspects of tax return. There are many tax consultants out in the market. Make sure that you choose an experienced one to address your needs.

Author’s Bio: Alisa Martin is a freelance writer, professional blogger, and social media enthusiast. Her blog Money Exchange Rates focuses on Finance bloggers. You can follow her on Google+

Related articles

• An Incorrect 1098-T Can Sink Your Tax Return (whatisa529plan.com)
• Are You Responsible for Your Spouse's Tax Bill? (50plusfinance.com)
• A Quick and Easy Guide on Tax for Charitable Donations (50plusfinance.com)
• What Happens If I Take to Much Out of My 529 Account? (whatisa529plan.com)

A Quick and Easy Guide on Tax for Charitable Donations

Taxes (Photo credit: Tax Credits)

If you make charitable donations to approved organizations you may be able to lower your tax bills. However, there is a number of IRS set steps you must follow to qualify for charitable donation tax reductions. All you have to do if use the guidance provided below and you will be on the right track to help your chosen cause and benefit from tax savings in the process. 


To gain a legitimate tax reduction, the charity you donate to must be a qualified organization that meets all of the IRS’ requirements. For a start, you cannot claim tax reductions for donations given to political candidates, political organizations or individuals. To get a full rundown of what constitutes a qualified organization, read IRS Publication 526, Charitable Contributions, which gives a clear description of the regulations. 


Be aware that should you receive any kind of benefit from your charitable contribution, be it merchandise or services, then you can only deduct the tax amount that is in excess of the benefit’s fair market value. Fair market value is the agree price at which property could be exchanged between a willing buyer and seller, with both parties fully aware of the facts relating to the property. For more information, read IRS Publication 561, Determining the Value of Donated Property. 


To deduct a charitable contribution from your tax, you are required to file Form 1040, making sure that you carefully itemize all deductions on the part of Form 1040 entitled Schedule A. If you are donating stock or a different form of non-cash property, it will be valued at the fair market value. For the specific rules that apply to vehicle donations, read IRS Publication 526, Charitable Contributions. 


No matter how much your contribution comes to, to deduct it you have in your possession a bank record, payroll deduction records or a written document of communication from a representative of the charity that states the name of the organization, the amount of the contribution and the date that it was made. If you donate via a text message, you can use your telephone bill as proof, but it must state the name of the organization, the amount and the date given. 


If your total tax deduction for non-cash contributions exceeds $500 for the year, you must fill out and attach IRS Form 8283, Non-Cash Charitable Contributions, to your tax return. If you donate an item or collection of items with a value in excess of $5,000 you will also be required to complete Section B of Form 8283, which usually requires the services of a qualified appraiser. 
For further information, simply visit the IRS website, or phone them on 800-TAX-FORM (800-829-3676). 


As a recap, here are the documents you should read to learn more about tax on charitable contributions: 

• Refer to the instructions included on Form 8283, Non Cash Charitable Contributions 
• Read Publication 526, Charitable Contributions for clear details on specific rules 
• To get helpful information on determining value, read Publication 561, Determining the Value of Property 

Author Bio 

This article was contributed to 50 Plus Finance by George Papas. You can read more of his work on a number of different sites including Jeffrey Epstein among others. 

Related articles

• Are You Responsible for Your Spouse's Tax Bill? (50plusfinance.com)
• Does Your Tax Preparer Have the Proper Credentials? (50plusfinance.com)
• An Incorrect 1098-T Can Sink Your Tax Return (whatisa529plan.com)
• Managing Your Business From Home (savealittlemoney.com)

What's $40 Dollars To You?

As usual our employees in Washington D.C. are making a mess of everything. They can't even get it together to give us a meaningless tax break. The bottom line of this whole mess is that the average family will lose their $1000 tax cut if the Congress doesn't act by the end of the year. Why is it they always wait till the last minute to take care of these things? It's like my kid waiting till the last minute to do his homework.

The $1000 tax break comes down to $40 every two weeks. Is that such a big amount to get so worked up for? Well, the White House seems to think it is a big deal and they have set up a web site for you to chime in on what you think: www.whitehouse.gov/40dollars

It seems $40 every two weeks can amount to something over time. In 3 years it turns into $3,531. In 5 years it grows to $6,403. In ten years it grows to $15,951.

It seems $40 is a significant amount. Such a small amount invested every two weeks can have an interesting effect on your retirement needs.

Related Post: Investing 101: Index Funds

Six Tax Breaks Expiring At The End of 2011

Image by 401K via FlickrBefore you know it the holidays will be over and tax time will be here. As this year comes to a close several tax breaks will be ending for good. Before 2012 arrives be sure to take advantage of them.

Listed below are the six tax breaks about to expire unless Congress extends them:

1. Expenses For Higher Education.

The deduction of up to $4,000 for qualified higher education expenses won't be available after 2011. It probably is smart to consider prepaying eligible expenses for 2012. The deduction applies to tuition and fees paid in connection with enrollment at an institution of higher education during 2011 or the first three months of 2012. The maximum deduction is available to taxpayers with adjusted gross incomes of up to $65,000 for singles and $130,000 for joint filers. A deduction of $2,000 is allowed for singles with adjusted gross incomes of up to $80,000, or joint filers with adjusted gross incomes up to $160,000.

2. Adoption Tax Credit.

The Adoption Credit and Adoption Assistance Program lets adoptive parents claim a credit against their federal tax of up to $13,360 for "qualified adoption expenses" for each adopted child. Though new access to the credit expires when the program ends on Jan. 1, the rules allowed the credit to be carried forward over five years.

3. Sales Tax.

If you don't pay state and local income taxes -- a common situation for retired public employees or those living in 'no-income-tax' states like Florida -- you have had the choice of using the optional sales tax deduction to cut your federal income tax. After 2011, that option goes away. So if you're planning to buy big-ticket items like a new car in the near future, you might want to push them up into 2011 to get those last deductions.

4. Mortgage Insurance Premiums.

As of 2012, you won't even be able to take the mortgage insurance premium deduction. 2011 is the last time homeowners with joint adjusted gross incomes of less than $109,000 will be able to deduct the cost of mortgage insurance on a first or second home.

5. Teachers' Classroom Materials.

For years, K-12 teachers, instructors, counselors, principals or aides who worked in a school for at least 900 hours during a school year could claim an "above the line" deduction for up to $250 of expenses incurred for books, supplies, computer equipment or supplementary materials used in the classroom. Shop now, teachers: Starting next year, that deduction will disappear like kids vanishing from the classroom when the bell rings.

6. Energy-Efficient Home Upgrades.

Making energy-saving improvements to your home not only cuts down on heating and cooling costs, it also earns you a tax credit. For example, if you add extra insulation in your attic, replace drafty old windows with modern thermal-pane models, or install an energy-efficient heater or air conditioner, you're eligible for a tax credit of 10% of the cost, up to $500. You don't have to attach the manufacturer's certification that the property meets the requirements for the credit to your tax return, but you must maintain records that establish your entitlement. However, if you've claimed this credit for upgrades in past years, you can't do it again: It's a one-time deal.

These tax breaks should all be considered with the help of a knowledgeable tax preparer.

Proposed Changes to the Mortgage Interest Deduction - Can You Live Without It?

Image via WikipediaOur friends in Washington are talking about limiting or eliminating the mortgage interest deductions. This could be disastrous to people who bought a house counting on using that deduction. This would change the equation for many families who would have to pay much more in taxes. What would be the affect on the already down housing market, would it send it even further downward?

I don't think the politicians would have the courage or political will to eliminate a deduction most home owners count on. The mortgage interest deduction is the largest deductions that people use on their tax return. But I think they will do a little tinkering with it in the years to come.

I believe the congress does feel safe to cut the deductions on the extremely rich. Today, the deduction does have limits. You only can clain mortgage deductions on mortgages up to $1,000,000. It's proposed to move that limit down to $500,000. In most of the U.S. the average house sells for $200,000, so the change wouldn't effect many people. But on the West Coast, the average house price is $600,000, so many non-rich families would be effected.

Still another proposal would eliminate the deduction all together and just issue mortgage holders a tax credit.

What To Do?

If you have a mortgage of $500,000, it looks like your safe. The deduction probably won't change but if it does, it will probably turn into some type of credit.

If you have a mortgage of more than $500,000 you may lose some of your normal deductions. You may be wise to pay down your mortgage to get you under the upper limit. On the bright side, this changing of the deduction might encourage homeowners to buy a less expensive home so as to live more within their means.

Will Renters Be effected?

If the mortgage deduction is reduced will landlords pass on the extra taxes paid, onto the tenants? Here the congress has a way to fix that problem and that is to pay the renter a renters credit to off set the additional rent charge. But hopefully the coming changes would not effect investment property.

My normal interest paid on my mortgage comes to $10,000 per year. It's my largest deduction and any change would increase how much taxes I pay.

Who Is Pushing the Hardest Against This Change?

The "NATIONAL ASSOCIATION OF REALTOR" is up in arms concerning this proposal. They claim it will drive down home prices by 15%. This drop in home values will also cause a drop in property taxes collected, thus harming local and state services. So even non-home owners will suffer from this reduction in the deduction.


We all are used to this healthy tax deduction. We all save quite a bit of money every year. The deduction is a great incentive to buying a home and even a second or vacation home. But reducing it seems to be the wave of the future. I remember when they eliminated the credit card interest deduction. The sky was supposed to fall then, it didn't. We survived and don't even miss it now or remember it. This is what will happen with the mortgage deduction, we will survive.

Tax Relief From The Chinese Drywall Problems

Image via WikipediaBeing in the building business in South Florida I see a lot of the issues concerning home sales. There is a glut of homes on the market plus plenty of home foreclosures. It's hard to sell a house now a days. Construction of new homes hasn't stopped which only adds to the problem. Mortgages can't be obtained because appraisals come in so much lower than the asking price.

Builders and home owners are also suffering from having homes that have Chinese drywall. Chinese drywall is drywall shipped from China that has containment's that give off toxic, high levels of sulfur gas. The gases cause copper components to corrode and fail. The air conditioners, wiring, and copper plumbing corrode and fail. It also causes the occupants of the homes to become ill.

The only remedy to the problem is to gut the house. Remove all drywall, copper pipes, all wiring, and any metal studs. It must be done down to the block outer walls. This remedy is very expensive to say the least. Costs to do exceed $100,000.

In our state the insurance companies won't touch the claims. Saying it's not part of their coverage. Even insurer of last resort, Citizens Insurance, the state run insurance agency won't have anything to do with the claims. So everyone sits waiting for the lawsuits and the goodwill of the manufacturer to step up.

The IRS has stepped up and allowed a deduction of 75% of expenses for the repairs. If at a later time the home owner is compensated from a insurer or lawsuit, the tax relief must be paid back. Also Broward County has stepped up and will not charge a property tax on the home if it is not livable. Check your own county if similar relief is available.

This has been a terrible blow to many homeowners. But some relief is available. If you know of any other kinds of relief, drop me a line.

5 Tax Benefits For Students

Image by tilitran via Flickr
With college being so expensive you need all the help you can get to save a little money. Our friends over at HRBlock.com have given us 5 tips that apply to the student or the one paying for the students education. 

• American Opportunity Credit: Up to $2,500 in 2010 for qualified education expenses will be paid to each eligible student who is enrolled part-time or full-time. You can claim the credit only for the first four years of higher education, but it doesn't apply to private secondary school or graduate school. This credit is 40 percent refundable and up to $1,000 may be refunded to the taxpayer even if there is no tax liability.
• Lifetime Learning Credit: You can receive up to $2,000 for qualified education expenses. You can claim this credit only once per return, but there is no limit on the number of years you can claim the credit. You're eligible for this if you're a student who takes one or more courses. Qualified expenses for the Lifetime Learning Credit include the cost of courses that aren't part of a degree or certificate program. So if you work and take occasional courses to strengthen your job skills, you are eligible for this credit.
• Tuition and Fees Deduction: You may be eligible for up to 100 percent of qualified higher education expenses with a maximum of either $4,000 or $2,000, depending on the taxpayer's filing status and income level. Like the Lifetime Learning Credit, there is no course load requirement or limit on the number of years the deduction can be taken.
• Student Loan Interest Deduction: If you are paying back student loans used to pay for higher education, you may be eligible to deduct up to $2,500 per return for every year.
• Employer-provided Educational Assistance: If you received educational assistance benefits from your employer you can exclude up to $5,250 of those benefits each year.

Our tax returns are becoming more complicated every year. If you have any doubt to your ability to complete them correctly be sure to hire a competent tax preparer. They always seem to find those pesky deductions we miss. They may be able to keep a little more coin in your pocket and less in Uncle Sam's.

Related articles

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• Students Shouldn't Miss Out on Valuable Tax Deductions (onlinecollege.org)
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