With the end of the year approaching, many people are thinking about what they can do to save on their taxes. If you are not careful, you can easily overpay on your taxes by not utilizing deductions that are available to you. Here are a couple ways you can save on your taxes that you may not have known about.
1. College Credits and Student Loan Interest Deductions
First, if you are currently in college, or you are paying for a dependent to go through school, then you might qualify for a credit. A credit is even more than a deduction. It is not money deducted from the total amount that you owe in taxes; instead, it is just money in your pocket. There are lifetime learning credits that allow you to get a certain amount of money for the 4 years that you are paying for someone, including yourself, a spouse, or a child, to go through college. If you haven't already taken that credit, you should do so now.
Second, if you are paying off student loans then you should be sure that you report it on your taxes. Every dollar you spend in student loan interest counts towards a deduction on your taxes. This will save you a lot of money if you simply report all the money you paid in student loan interest that year.
2. Health Care Expenses
It is important that you keep track of all of the money that you put toward health care during the year. This includes insurance premiums, if you are paying them yourself, and even medical bills and medical supplies. If you had a procedure done where you paid a good deal in medical care, keep all the bills and report it on your taxes. This will help to save you money.
3. Moving Expenses
If you had to relocate for work, then you should make sure you report it on your taxes. When you move you usually pay for a moving company, rental vans, moving boxes, gas, hotels, food, and so forth. All of the money that went toward your move can be deducted if you keep the receipts and can prove that each dollar you spent went toward the move.
By understanding these lesser known deductions and credits, you can save yourself a good deal of money this tax season. If you are still unsure about what deductions and credits you can take, talk to a tax professional or go to website.