11 Tax Deductions You Might Be Overlooking (2024)

FAQs

What are overlooked write offs? ›

Gambling losses up to your winnings. Interest on the money you borrow to buy an investment. Casualty and theft losses on income-producing property. Federal estate tax on income from certain inherited items, such as IRAs and retirement benefits.

These deductions may include tax withholdings (FITW and SITW), tax payments (FICA, Medicare, etc.), debt collections and allotments. Knowing where your money is going is just as important as knowing how much is being deposited in your savings or checking account.

Itemized deductions are expenses the taxpayer incurred, such as mortgage interest, state or local income taxes, property taxes, medical or dental expenses, or charitable donations.

A tax deduction is a provision that reduces taxable income. A standard deduction is a single deduction at a fixed amount. Itemized deductions are popular among higher-income taxpayers who often have significant deductible expenses, such as state and local taxes paid, mortgage interest, and charitable contributions.

If you're claiming actual expenses, things like gas, oil, repairs, insurance, registration fees, lease payments, depreciation, bridge and tunnel tolls, and parking can all be deducted." Just make sure to keep a detailed log and all receipts, he advises, and keep track of your yearly mileage and then deduct the ...

Only those who are self-employed or own a business and use a vehicle for business purposes may claim a tax deduction for car loan interest. If you are an employee of someone else's business, you cannot claim this deduction.

Is car insurance tax deductible? ›

Car insurance premiums may be tax deductible if you're self-employed and do business-related driving. You can file an IRS Form 1040 or IRS Form 2106 to write off car insurance on your taxes.

The standard deduction is a specific dollar amount that reduces the amount of taxable income. The standard deduction consists of the sum of the basic standard deduction and any additional standard deduction amounts for age and/or blindness. In general, the IRS adjusts the standard deduction each year for inflation.

Voluntary deductions are amounts which an employee has elected to have subtracted from gross pay. Examples are group life insurance, healthcare and/or other benefit deductions, Credit Union deductions, etc.

Common pay stub deductions include federal and state income tax, as well as Social Security. These federal and state withholdings account for much of the difference between your gross income and net income. There may be other deductions as well, depending on the programs that you sign up for with your employer.

Write-off is an extreme variant of a write-down. This happens when the book value of an asset is below its fair value. For example, if damaged equipment is partially usable, it can be written down or if a debt is partially paid off by the debtor, it will again be partially written down.

To qualify for a write-off, the IRS uses the terms "ordinary" and "necessary;" that is, an expense must be regarded as necessary and appropriate to the operation of your type of business. Generally, tax write-offs fit into specific reporting categories such as business travel, advertising, or home office expenses.

A bad debt write-off is the process of removing an uncollectible debt from a business's accounting records. This accounting method acknowledges the loss incurred when a debtor fails to repay a debt.

Unlike other assets that have a discernible useful life, goodwill is not amortized or depreciated but is instead periodically tested for goodwill impairment. If the goodwill is thought to be impaired, the value of goodwill must be written off, reducing the company's earnings.